COVID 19 affects Statistics Botswana’s operations

Statistics Botswana’s data collection for consumer price index (CPI) compilation continues to be affected by the COVID-19 regulations.

With alcohol making part of the consumer basket, Statistics Authority this week bemoaned that the collection and compilation of CPI has been impacted by measures designed to limit the spread of COVID-19 since April 2020. “Due to the closure of all outlets selling alcoholic beverages on 4th January 2021, to minimize the spread of the COVID-19, imputation was used for all the missing alcoholic beverage items for the January 2021 CPI,” said Statistician General, Dr. Burton Mguni.

According to Statistics Botswana, the imputation strategy was developed by the International Monetary Fund (IMF), following consultation with the regional and national statistical organizations to address an increased number of temporary business closures.

The imputation method has since been adopted and implemented based on the international guidelines. Though the country’s annual inflation rate has been stable during the last quarter of 2020, the latest CPI report from Statistics Botswana indicates that the annual inflation rate in January 2021 was 2.3, registering an increase of 0.1 of a percentage point on the December 2020 rate of 2.2 percent.

“The key contributors to the January annual inflation rate were housing, water, electricity, gas and other fuels, food and non-alcoholic beverages and transport,” said Mguni.Mguni further said group indices were generally moving at a stable pace between December 2020 and January 2021, recording changes of less than 1.0 percent, except the education group index which recorded 1.7 percent.

Meanwhile, economist and former minister of Investment, Trade and Industry Bogolo Kenewendo has warned that inflation will increase in the short term due to government’s efforts to broaden its tax base.

“An introduction in new levies and increase in taxes will reduce disposable income and depress real consumer spending.

It’s anticipated that the increase in prices of goods will be more than the increase in taxes or introduction in levies,” said Kenewendo.

She further bemoaned that most Batswana households are over indebted, on unpaid leave, reduced salaries or unemployed, indicating that the increase in prices will negatively affect livelihoods.