Ethiopia’s inflation drops by half in 2009

By Tesfa-alem Tekle

March 26, 2009 (ADDIS ABABA) –The increase inflation rate in Ethiopia that reached 64% in July 2008 has dropped to 32.8% since last month in country level, the central statistical Agency Said.

According to the agency, the sharp decline was possible after the government took a series of strong financial and administrative measures to stabilize the market and to cut short soaring prices.

Inflation on food price which was the worst (that reached almost 92%) in July last year has now dropped to 39%.

The rampant inflation rate Ethiopia faced was due growing economy (as Prime Minister Meles Zenawi said), increase in demand, greedy merchants or farmers who deliberately raise the price demanding over income from their agricultural products.

The agency added that the government of Ethiopia has imported dozens of metric tons of wheat to stabilize market.

New agricultural products like maize that widely enter to the market have also put pressure in stabilizing the galloping inflation.

Beyond the decline on the major food items, the cost on some public services such as transport has also lowered prices due the global decline in oil price. The agency added.

The country’s inflation rate is expected to further drop during the coming months too.

(ST)