Zambia’s Inflation Rises to 14.7% in May: Economic Expert Calls for Urgent Measures
Zambia’s annual inflation rate has surged to 14.7% in May 2024, up from 13.8% in April, according to recent data.
This steep increase is driven by rising costs in both food and non-food sectors, placing significant pressure on the cost of living for Zambians.
Economic experts attribute the inflationary spike to escalating prices of essential commodities, particularly electricity and fuel.
These rising costs have a cascading effect on the economy, increasing the cost of capital stock and impacting both production and consumption fundamentals.
Kelvin Chisanga, a prominent economic analyst, emphasizes the urgency of addressing inflation through robust measures by the Central Bank and the Central government.
“Inflation is often considered a poor man’s tax. It is imperative that we combat it at all possible costs,” Chisanga stated.
He advocates for adjustments in service charges and strategic interventions in the energy sector to stabilize prices.
The current inflationary trend, largely fueled by energy supply deficits and forex market instabilities, poses significant challenges.
The repercussions are evident in the rising prices of essential goods and services, affecting everyday life for Zambians.
To mitigate these effects, Mr. Chisanga suggests a dual approach: enhancing energy supply and strengthening forex market interventions.
He calls for a comprehensive national dialogue (Indaba) on diversifying energy sources to stabilize the sector and foster economic growth.
“Energy is central to our economy. We must explore productive investment ideas to safeguard this critical sector,” he added.
Moreover, Mr. Chisanga highlights the need for focused policies on key imports like fuel, maize, and electricity. Ensuring stable import processes will help cushion the economy against further inflationary pressures.
The Central Bank has already begun taking steps by adjusting service charges upward.
However, he said that more concerted efforts are needed to bring inflation within the target policy corridor and support economic growth.
