The Zimbabwe National Statistics Agency (ZimStat) has said the cost of living in Zimbabwe increased by 11% in April compared to March. This was mainly due to the depreciation of the Zimbabwe dollar. ZimStat reported that an individual needed $33,044 in April, up from $29,778.08 in March. Said the agency in its latest cost of living statistics report:
The Total Consumption Poverty Line for Zimbabwe stood at $33 044,46 per person in April 2023.
This means that an individual required that much to purchase both non-food and food items as at April 2023 in order not to be deemed poor.
This represents an increase of 11% when compared to the March 2023 figure of $29 778,08.
According to ZimStat, the total consumption poverty line (TCPL) of $33 044 is the minimum total income that an individual needs to not be considered poor. ZimStat also stated that their official Poverty Datum Lines are not comparable to the cost of living indicators produced by others in the market.
Over the past three weeks, the Zimbabwe dollar has fallen to $2 100 against the US dollar on the parallel forex market, compared to $1 000 previously.
Analysts say the depreciation of the local currency can be attributed to a number of factors including the lack of adequate support structures. As a result, prices of goods and services have skyrocketed, and some shops now only accept US dollars for certain products or services. According to ZimStat, an income of $33,044 is required to avoid poverty, but this is still considered high poverty by the World Bank, which defines extreme poverty as living on less than $1.90 per day.
Some economists have argued that ZimStat’s cost of living calculation for April does not reflect the reality on the ground.
American economist Steve Hanke responded to ZIMSTAT’s report by stating that he measured Zimbabwe’s inflation rate at 455% per year on April 20, which is almost twice the official inflation rate of 243.8% reported by ZimStat. He also called ZimStat’s measurements “phoney” and criticized the director-general, Taguma Mahonde.
Economist Prosper Chitambara told NewsDay in an interview:
That is not realistic and a correct figure of what an average person would require per month to survive because just food alone costs more than that.
For those who go to work if you are going to buy a plate of sadza for a dollar it means for the month you would spend almost US$20 just on food for lunch, so that is not a correct and realistic figure.
Although prices of goods and services have gone up, the blended inflation rate in April was 75.2%, which is 12.4 percentage points lower than March’s rate of 87.6%.