PRESS STATEMENT ON THE INCREASE IN THE FUEL PUMP PRICES AND THE COST OF LIVING - 4 APRIL 2022
The Jesuit Centre for Theological Reflection (JCTR) publishes the results of the Basic Needs and Nutrition Basket (BNNB) survey at the beginning of every month in order to monitor the cost of living at the household level. For instance the BNNB for Lusaka stood at K9, 049.25 for the month of January 2022, a K689.45 increase in comparison to the December, 2021 basket that stood at K8, 359.80. This signified an 8.24percent increase in the cost of living between December 2021 and January 2022. The BNNB for Lusaka has continued to rise since January 2022. This is in contrast to the recent trend in the national inflation which has been on the decline.
According to the Zambia Statistics Agency Zambia’s inflation rate for March has declined to 13.1 percent from 14.2 percent recorded in February driven by the base effect, which compares inflation in the corresponding period of the previous year. The Zambia Statistics Agency reports that the food inflation decreased to 15.3% in February 2022 as compared to 16.0 percent in February 2021. The non-food inflation decreased to 10.3% in February 2022 from 11.8% in February 2021.
In the light of the contrasting trends between the inflation and the cost of living, it is important that an explanation is provided to address this incongruity. The point that needs to be highlighted is that although these two indicators are intimately related, they are not synonymous. The explanation lies in the definition of inflation; “inflation measures the rate of increase of general prices level”. The opposite is deflation, “the general decline in prices for goods and services”. Therefore, a decline in inflation rate does not mean that prices have necessarily reduced. All it means is that the rate at which these prices are rising over the comparable period has reduced. We can only talk about reduction in prices if the inflation rate falls below zero (in this case it becomes deflation).
Inflation presents the big picture. As the cost of goods and services rises, the buying power of the Kwacha falls. The inflation rate is often measured by the change in the Consumer Price Index (CPI), a monthly measure by the Zambia Statistics Agency that averages the cost of a basket of goods and services from areas around the country. It reports the result as a percentage rise or drop in CPI. Cost of living has a different focus. The cost of living represents the average cost of an accepted standard of living including basic food items and essential non-food items.
Cost of living is frequently used to compare minimum income needs in a given location, town or country. Cost of living measures the change, up or down, of the basic necessities of life, like food, housing, and healthcare. Since January 2022 the cost of living in Zambia has been on the upward trend corresponding to the rise in commodity prices. This scenario is not surprising given that the rise in fuel pump prices generally does have a spiral effect on the commodity prices in Zambia.
The fuel pump price adjustment by almost K10 between December 2021 and April 2022 and the resultant adjustment in the commodity prices is inevitably going to hit hard on the majority of the Zambian people whose incomes are already very low. According to a study report by Karl Pauw, Bernard Tembo and James Thurlow on “COVID-19 in Zambia: Impacts on Production, Poverty & Food Systems” published on 6th April 2021, poverty rate in Zambia increased by 4.3 percent due to “A JUST ZAMBIAN SOCIETY GUIDED BY FAITH, WHERE EVERYONE ENJOYS FULLNESS OF LIFE” the COVID-19 pandemic. The rising cost of living is just setting on course, and it looks likely that it is going to push more households into absolute poverty. In the midst of this, Government has urged citizens to be extra resilient because it is aggressively working towards stabilizing and ultimately lowering fuel pump prices and improve the general economic welfare of Zambians. It is yet to be seen if what Government is pointing to as its key commitments such as delivery on Constituency Development Fund, rolling-out of social cash transfer programme, implementation of free education programme, payment of salary arrears for local government employees, recruitment of health and education workers will be enough to cushion Zambian households from the pangs of the rising cost of living when the fuel pump prices still remain very high in the short term.
What does Government say to a poor household in Chibolya compound which is not a beneficiary of any of the above listed programmes and yet it now has to pay more for food and other basic necessities?
Fr. Alex Muyebe, S.J., JCTR Executive Director. For further information, please contact the Jesuit Centre for Theological Reflection (JCTR) on 0954755319. Email: media.information@jctr.org.zm. Martin Mwamba Road, Plot 3813 Martin Mwamba Road, Olympia Park – Lusaka. P. O. Box 37774 Lusaka - Zambia
TO DOWNLOAD THE STAEMENT CLICK HERE
According to the Zambia Statistics Agency Zambia’s inflation rate for March has declined to 13.1 percent from 14.2 percent recorded in February driven by the base effect, which compares inflation in the corresponding period of the previous year. The Zambia Statistics Agency reports that the food inflation decreased to 15.3% in February 2022 as compared to 16.0 percent in February 2021. The non-food inflation decreased to 10.3% in February 2022 from 11.8% in February 2021.
In the light of the contrasting trends between the inflation and the cost of living, it is important that an explanation is provided to address this incongruity. The point that needs to be highlighted is that although these two indicators are intimately related, they are not synonymous. The explanation lies in the definition of inflation; “inflation measures the rate of increase of general prices level”. The opposite is deflation, “the general decline in prices for goods and services”. Therefore, a decline in inflation rate does not mean that prices have necessarily reduced. All it means is that the rate at which these prices are rising over the comparable period has reduced. We can only talk about reduction in prices if the inflation rate falls below zero (in this case it becomes deflation).
Inflation presents the big picture. As the cost of goods and services rises, the buying power of the Kwacha falls. The inflation rate is often measured by the change in the Consumer Price Index (CPI), a monthly measure by the Zambia Statistics Agency that averages the cost of a basket of goods and services from areas around the country. It reports the result as a percentage rise or drop in CPI. Cost of living has a different focus. The cost of living represents the average cost of an accepted standard of living including basic food items and essential non-food items.
Cost of living is frequently used to compare minimum income needs in a given location, town or country. Cost of living measures the change, up or down, of the basic necessities of life, like food, housing, and healthcare. Since January 2022 the cost of living in Zambia has been on the upward trend corresponding to the rise in commodity prices. This scenario is not surprising given that the rise in fuel pump prices generally does have a spiral effect on the commodity prices in Zambia.
The fuel pump price adjustment by almost K10 between December 2021 and April 2022 and the resultant adjustment in the commodity prices is inevitably going to hit hard on the majority of the Zambian people whose incomes are already very low. According to a study report by Karl Pauw, Bernard Tembo and James Thurlow on “COVID-19 in Zambia: Impacts on Production, Poverty & Food Systems” published on 6th April 2021, poverty rate in Zambia increased by 4.3 percent due to “A JUST ZAMBIAN SOCIETY GUIDED BY FAITH, WHERE EVERYONE ENJOYS FULLNESS OF LIFE” the COVID-19 pandemic. The rising cost of living is just setting on course, and it looks likely that it is going to push more households into absolute poverty. In the midst of this, Government has urged citizens to be extra resilient because it is aggressively working towards stabilizing and ultimately lowering fuel pump prices and improve the general economic welfare of Zambians. It is yet to be seen if what Government is pointing to as its key commitments such as delivery on Constituency Development Fund, rolling-out of social cash transfer programme, implementation of free education programme, payment of salary arrears for local government employees, recruitment of health and education workers will be enough to cushion Zambian households from the pangs of the rising cost of living when the fuel pump prices still remain very high in the short term.
What does Government say to a poor household in Chibolya compound which is not a beneficiary of any of the above listed programmes and yet it now has to pay more for food and other basic necessities?
Fr. Alex Muyebe, S.J., JCTR Executive Director. For further information, please contact the Jesuit Centre for Theological Reflection (JCTR) on 0954755319. Email: media.information@jctr.org.zm. Martin Mwamba Road, Plot 3813 Martin Mwamba Road, Olympia Park – Lusaka. P. O. Box 37774 Lusaka - Zambia
TO DOWNLOAD THE STAEMENT CLICK HERE
A REVIEW OF THE IMPLEMENTATION OF THE FARMERS INPUT SUPPORT PROGRAMME (FISP) THE NATIONAL ASSEMBLY COMMITTEE ON AGRICULTURE, LANDS AND NATURAL RESOURCES - December 2021
Zambia is gifted with a lot of natural resources and is one of the major producers of copper and other minerals such as cobalt and emeralds. The country has large territories of fertile land, which are suitable for agriculture. Agriculture remains a key priority for the growth and poverty reduction agenda for Zambia as more than 60 percent of its population derive its livelihood from it. Additionally, the agriculture sector is the biggest employer in the informal sector and produces a higher percentage of official employment prospects across all economic sectors in the country (Central Statistics Office, 2019) From 1960 to 2020, the average value for Zambia’s agriculture as a percentage of Gross Domestic Product (GDP[1]) stands at 12.82 percent with a minimum of 2.73 percent in 2020 and maximum of 30.48 percent in 1993. Agriculture’s contribution to GDP has been declining from 9.6percent in 2011 to 2.7percent by 2020.
This is despite agriculture being declared as a key sector to enable the nation record high levels of growth while delivering the much needed development for its people. Zambia remains one of the poorest countries in the Sub-Saharan region with over 50 percent of its population living in poverty. The agriculture sector also faces several challenges; low productivity, low yields, hampered by climate change and a larger focus on one key crop; maize. Among small-scale farmers; food insecurity, low farm incomes and high rural poverty are noted.
The Comprehensive Africa Agriculture Development Program (CAADP) commitment to allocate at least 10 percent of the national budget to the agricultural sector is yet to be met. The highest allocation can be traced to 2015 and 2017 representing 9.3 and 9.4 percent of the national budget respectively. The 2021 allocation whilst an improvement from the allocations of 2019 and 2020 was also only 6.7 percent representing ZMW7.2billion. For 2022, a total of ZMW7.3billion (4.2percent of the 2022 national budget) was allocated to agriculture. It is also notable that a large chunk of the agriculture budget is consumed by the Farmers Input Support Program (FISP). In 2022, FISP has been allocated ZMW5.7billion translating to 78percent of the total agriculture budget. (Ministry of Finance, 2021). Full submission
This is despite agriculture being declared as a key sector to enable the nation record high levels of growth while delivering the much needed development for its people. Zambia remains one of the poorest countries in the Sub-Saharan region with over 50 percent of its population living in poverty. The agriculture sector also faces several challenges; low productivity, low yields, hampered by climate change and a larger focus on one key crop; maize. Among small-scale farmers; food insecurity, low farm incomes and high rural poverty are noted.
The Comprehensive Africa Agriculture Development Program (CAADP) commitment to allocate at least 10 percent of the national budget to the agricultural sector is yet to be met. The highest allocation can be traced to 2015 and 2017 representing 9.3 and 9.4 percent of the national budget respectively. The 2021 allocation whilst an improvement from the allocations of 2019 and 2020 was also only 6.7 percent representing ZMW7.2billion. For 2022, a total of ZMW7.3billion (4.2percent of the 2022 national budget) was allocated to agriculture. It is also notable that a large chunk of the agriculture budget is consumed by the Farmers Input Support Program (FISP). In 2022, FISP has been allocated ZMW5.7billion translating to 78percent of the total agriculture budget. (Ministry of Finance, 2021). Full submission
29th December 2021 - GET VACCINATED NOW
Just like any other viral infections, there are currently no medicines to stop the virus, especially once inside the body. This means that people have to rely on the immune system to fight off the virus, especially that antibiotics do not work for viral infections. Vaccines can help stop the progression of many viral diseases. A COVID‑19 vaccine is intended to provide acquired immunity against the virus that causes COVID‑19. Prior to the COVID‑19 pandemic, an established body of knowledge existed about the structure and function of coronaviruses causing diseases like Severe Acute Respiratory Syndrome (SARS) and Middle East Respiratory Syndrome (MERS). This knowledge accelerated the development of various vaccine platforms during early 2020, the body of knowledge, which has been used in coming up with COVID-19 vaccines. Safe and effective vaccines are an important tool, in combination with other measures, to protect people against COVID-19. They help in saving lives and reduce wide scale social disruption.
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When someone is vaccinated, they are very likely to be protected against severe disease and hospitalisation. When a lot of people in a community are vaccinated, the virus has a hard time circulating because most of the people it encounters will have developed immunity towards it. So the more people are vaccinated, the less likely are people at risk of being exposed to the virus, including those who cannot be protected by vaccines for some reason or the other. This is called herd immunity. Vaccinating not only protects oneself, but also protects those in the community who for some reason cannot be protected by vaccines. According to the WHO, a country requires at least 74% heard immunity.
It is against this background that the Jesuit Centre for Theological Reflection is making an appeal for people to get vaccinated with approved COVID-19 vaccines as we call it “an act of love.” Pope Francis has praised the work of researchers and scientists in producing safe and effective COVID-19 vaccines. “Thanks to God’s grace and to the work of many, we now have vaccines to protect us from COVID-19.” The vaccines bring hope to end the pandemic, but only if they are available to all and if we collaborate with one another. Pope Francis says that helping others do the same, is also an act of love, a view which is shared by the Jesuit Centre for Theological Reflection. “Love for oneself, love for our families and friends, and love for all peoples. Love is also social and political.”
Getting vaccinated is a simple yet profound way to care for one another, especially the most vulnerable. We urge everyone to play our part in caring for one another – We urge all to get vaccinated. Find JCTR also on Facebook Youtube and Twitter
It is against this background that the Jesuit Centre for Theological Reflection is making an appeal for people to get vaccinated with approved COVID-19 vaccines as we call it “an act of love.” Pope Francis has praised the work of researchers and scientists in producing safe and effective COVID-19 vaccines. “Thanks to God’s grace and to the work of many, we now have vaccines to protect us from COVID-19.” The vaccines bring hope to end the pandemic, but only if they are available to all and if we collaborate with one another. Pope Francis says that helping others do the same, is also an act of love, a view which is shared by the Jesuit Centre for Theological Reflection. “Love for oneself, love for our families and friends, and love for all peoples. Love is also social and political.”
Getting vaccinated is a simple yet profound way to care for one another, especially the most vulnerable. We urge everyone to play our part in caring for one another – We urge all to get vaccinated. Find JCTR also on Facebook Youtube and Twitter
20th December 2021-JCTR Press Statement on the Removal of Subsidies
WILL RESOURCES REALIZED FROM SUBSIDY REMOVAL REALLY BE UTILIZED TO CUSHION THE POOR AND VULNERABLE?
On 16th December, 2021, the Energy Regulation Board (ERB) announced fuel price adjustments. Wholesale and pump prices for petroleum products were revised upwards effective midnight 16th December, 2021. The pump price of one litre of Petrol has increased by K3.54 and now pegged at K21.16 from K17.62. The pump price of one litre of diesel was also increased by K4.56 to K20.15 from K15.59. The pump price of one litre of Low Sulphur Gasoil (LSG) was increased from K17.82 to K22.29 which gives an absolute variance of K4.47. Kerosene prices have remained unchanged. This follows an announcement by the government that fuel subsidies will be removed so as to migrate to cost reflective pricing as a measure to return the nation on a path to debt sustainability. This adjustment is part of the economic reforms being implemented by the United Party for National Development (UPND) Government as part of its staff-level agreement with the International Monetary Fund. Full statement here
On 16th December, 2021, the Energy Regulation Board (ERB) announced fuel price adjustments. Wholesale and pump prices for petroleum products were revised upwards effective midnight 16th December, 2021. The pump price of one litre of Petrol has increased by K3.54 and now pegged at K21.16 from K17.62. The pump price of one litre of diesel was also increased by K4.56 to K20.15 from K15.59. The pump price of one litre of Low Sulphur Gasoil (LSG) was increased from K17.82 to K22.29 which gives an absolute variance of K4.47. Kerosene prices have remained unchanged. This follows an announcement by the government that fuel subsidies will be removed so as to migrate to cost reflective pricing as a measure to return the nation on a path to debt sustainability. This adjustment is part of the economic reforms being implemented by the United Party for National Development (UPND) Government as part of its staff-level agreement with the International Monetary Fund. Full statement here