The Civil Society for Poverty Reduction (CSPR) says a low inflation rate plays a key role in the fight against poverty but the country’s current economic trend shows that economic policies are not aligned using the inflation rate.
According to the Zambia Statistics Agency (ZAMSTATS), the annual inflation for April 2022 decreased to 11.5 percent from 13.1 percent recorded in March 2022, which means that on average, prices of goods and services increased by 11.5 percent between April 2021 and April 2022.
CSPR Executive Director Faides Tembatemba said government reduced the price of fuel for the month of May and the inflation rate has maintained a downward trend but the prices of goods and commodities have remained high.
Speaking in an interview with the Zambian Business Times-ZBT, Tembatemba explained that the low inflation rate is not impacting positively on the fight against poverty as the poverty levels are getting higer due to lack of a system that monitors price regulation.
Tembatemba said government should put in place a system that will monitor or track whether suppliers or wholesalers are ensuring that each time there is a reduction in fuel prices, or when the inflation rate is lower, prices of goods and commodities also reduce.
“We are appealing to government to be able to regulate or put in place a system that will monitor and ensure there is compliance because at the moment, nothing is moving. Poverty levels are still the same, poor people are still experiencing high food prices and government is not doing anything about it so as long as the food prices and essential commodities remain high the poverty levels will remain high”, she said.
She said citizens are not experiencing the positive effects of a low inflation rate, reduced fuel prices and a stable exchange rate because there is no system in place that ensures prices of commodities reflect these factors.
Tembatemba noted that Zambia has a liberalized economy therefore anyone can determine the pricing of any goods and services and whenever there is an increase in pricing factors, businesses are quick to adjust prices upwards but are reluctant to reduce prices of commodities when there is a reduction.
