August 2008 Zambian Inflation Escalated to 13.2 percent

The August 2008 Zambian inflation rate was recorded at 13.2 percent as a result of increases in the cost of food and fuel.

Changes in the annual inflation rates

From July 2008 to August 2008, the annual inflation rates increased for food, beverages and tobacco, transport and communication and recreation and education subgroups.

In the same period the rates for clothing and footwear, rent and household energy, furniture and household goods, medical care and other goods and services main groups declined.

Contribution of different items to the August 2008 Zambian inflation

The rise in the August 2008 Zambian inflation from 12.6 percent in July 2008 to 13.2 percent in August 2008 was due to increases in the cost of transport (fuel, air fares, and new motor vehicles), food, beverages and tobacco.

In the month of August 2008, food products accounted for 7.8 percentage points while non-food products accounted for 5.4 percentage points.

Annual food inflation rate – 16.3 percent

The annual food inflation rate which was recorded at 16.3 percent was mainly due to increases in the cost of maize meal, maize grain, other cereals and cereal products, meat, kapenta, cooking oil, dried beans, shelled groundnuts and tubers.

Decreases in prices were also recorded in the cost of fresh vegetables, sugar, and other processed food products.

Annual Non-food inflation

The annual non-food inflation rate decreased from 11.2 percent in July 2008 to 10.4 percent August 2008.

Maize grain prices increased in August 2008

A comparison of retail prices in the period indicated the following:

• The price of a 25 kg bag of roller meal increased by 9.6 percent from K 35,011 to K 38,370.
• The price of a 20 liter tin of maize grain increased by 9.7 percent, from K 16,926 to K 18,565.
• The price of 1 kg of dried kapenta (Chisense) increased to 13.4 percent,
• The price of 1 kg of tomatoes declined by 20.0 percent.

July 2008 Trade Surplus

In the month of July 2008 Zambia recorded a Trade Surplus valued at K 58.3 billion. This meant that the country exported more in July 2008 than it imported in value terms.

Zambia’s Major Exports In July 2008

The five products categories which accounted for 89.6 percent of Zambia’s export earnings were as follows:

• Copper and articles thereof accounted for 52.6 percent of total export earnings.
• Ores, slag and ash accounted for 25.7 percent of total export earnings.
• Other base metals such as cobalt which are copper related accounted for 5.6 percent of total export earnings.
• Boilers, machinery & mechanical compliance parts accounted for 4.2 percent of total export earnings.
• Tobacco and manufactured tobacco substitutes accounted for 1.5 percent of total export earnings.

Zambia’s Major Exports Destinations by Products in July 2008

The five major destinations of Zambia’s exports were the following:

Switzerland – 40.9 percent
Democratic Republic of Congo 23.9 percent
South Africa – 8.7 percent
Egypt – 5.7 percent
China – 3.2 percent

These five countries accounted for 82.4 percent of Zambia’s export earnings.

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