Namibia’s annual inflation rate for February 2023 has significantly increased to 7.2%, compared to 4.5% recorded in February 2022, according to official figures.
The inflation rate surge was driven by increases in the prices of transport, food, and non-alcoholic beverages, indicating a challenging economic environment for consumers.
According to the National Statistics Agency (NSA), the average monthly inflation rate for the last few months has been around 7%, with the annual inflation rate for goods estimated at 10.1%, while for services stood at 3.1%.
The average annual inflation rate for the period between February 2022 and February 2023 stood at 6.3%, while the 12-month average annual inflation rate from March 2022 to February 2023 was estimated at 6.5%.
“The highest changes in the annual inflation rate were mainly witnessed in the categories of Food and non-alcoholic beverages (14.0%); Transport (9.9%); Furnishings, household equipment, and routine maintenance of the house (7.6%); Alcoholic beverages and tobacco (7.1%),” said NSA’s Statistician-General and CEO Alex Shimuafeni.
The annual inflation rate for housing, water, electricity, gas, and other fuels, which accounts for 28.4% of the consumer basket, increased by 2.9% during February 2023, compared to the annual inflation rate of 1.3% registered in February 2022. Zone 1, which includes Kavango East, Kavango West, Kunene, Ohangwena, Omusati, Oshana, Oshikoto, Otjozondjupa, and Zambezi, recorded the highest annual inflation rate of 7.6%, while Zone 2 (Khomas) registered the lowest annual inflation rate of 6.7%.
“The analysis of the average retail prices for some of the basic products consumed by the households for the month of February 2023 indicates that Chicken, frozen assorted pieces (1.5kg), consumers in Zone 2 paid the lowest price at N$84.77, while the highest price was observed in Zone 1 at N$111.93,” said Shimuafeni.
Meanwhile, on a monthly basis, the inflation rate increased by 0.4% compared to 1.1% recorded a month earlier.
According to Simonis Storm Securities, voluntary trading updates and statements issued by various Johannesburg Stock Exchange-listed entities give some insight into future inflationary pressures for the country.
“The importance of analysing the internal inflationary pressures of these listed entities is due to the fact that these companies operate franchise businesses throughout Namibia. So, the price increases that these companies will have to enforce due to rising cost pressures will ultimately lead to higher prices in Namibia. Adding to this, high diesel and logistics costs will increase consumer prices in Namibia even further as products are transported mainly by trucks from South Africa to Namibia, Simonis Storm Economist Theo Klein said.
