Ghana’s inflation rate 6th highest in Africa

quist

June 17, 2016 5:50 PM

Evidently, three of the ten countries with the highest inflation rates in Africa have recorded their highest inflation rates ever in the last two years.

File Photo

Many African countries have had to deal with increased inflation rates in the past two years, and a myriad of local and international factors have been blamed for this.

In Ghana’s own context, the increasing inflation rate has been reflective of the relatively poor economic performance of the past three years.

2015 ended with an inflation rate of 17.7 percent, 1.2 percent less than the current rate of 18.9%.

It is hard to believe that between 2009 and 2010 Ghana’s inflation rate was a single digit with an annual average of 8.5%. And while citizens are feeling the pinch of high increases in the prices of goods and services, politicians are having discussions about whether or not standard of living has worsened.

Well, here are the 10 African Countries with the highest inflation rates today

Clearly, Ghana, currently has the 6 highest rate of inflation in Africa. So perhaps the criticisms are warranted. But what can this be attributed to?

Ghana’s high inflation rate is largely supply-induced, as major production constraints continue, the biggest of which is the supply and cost of energy.

The country is yet to fully step out of a protracted energy supply crisis. And just when things began to stabilize on the supply front, the Public Utilities Regulatory Commission increase price power by 59.2%.

Increased taxes on importation of raw materials and financial transactions, in addition to poor performance of the Ghana Cedi against the major international currencies have ensured that cost of production has increased tremendously.

There is quite a sizeable amount of work to be done, if Ghana is to get back to a single digit inflation rate. Industry will have to be prioritized in the provision and cost of energy. The current tax policy will also have to be looked at, as well as access to credit.

quist