Friday, September 15, 2006

Zimbabwe's annual inflation rate continues its upward surge, reaching a record high of 1,204.6% in August, and adding greater strain to the economy

BBC News:

The latest rise, which represents a month-on-month climb of 211%, came after slight falls in June and July.

The south African country's inflation has been in chaos since December 2004 when it soared to 622.8%.

Zimbabwe has been dogged by shortages of foreign currency to pay for fuel and food. Unemployment has reached 70%.

Goods cost more than 13 times what they did a year ago, compounding the hardship many Zimbabweans experience.

Analysts have predicted that inflation could hit 1,800% by the end of the year.

Last month Zimbabwe's Reserve Bank issued a new 100,000 Zimbabwean dollar note (equivalent to just under $1), to accommodate rocketing prices.

President Robert Mugabe denies claims that government policies, including land reforms, have contributed to the problems - instead blaming domestic and foreign enemies for the country's difficulties.

But many analysts have said the ruling party has played a key role in precipitating the crisis.

They argue the government aggravated the situation when it took control of land owned by white farmers, which triggered a sharp drop in production and exports of agricultural goods.

According the United Nations' agencies, more than four million of the country's 13 million people face food shortages.

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