To offer some price relief to consumers, Namibia’s Ministry of Mines and Energy is currently in talks with the Ministry of Finance to suspend certain taxes and levies on the fuel price, says Ruusa Nandago, FirstRand Namibia Group Economist.
Nandago says the will be announced during April. Despite an 8 percent increase in domestic fuel prices between February and March, Namibia’s March inflation print remained unchanged from February at 4.5 percent year/year. Nandago explains that the month-on-month increase in fuel prices was counteracted by a marked slowdown in food prices from 5.4 percent year/year in February to 4.6 percent year/year in March, largely owing to disinflation in the meat, fish, dairy, sugar, fruit, vegetable, and non-alcoholic beverages sub-categories.
“While we had expectation for a higher inflation rate during March (owing to the elevated global prices) did not materialise, we maintain our view that price pressures will continue to build in the economy as the Ministry of Mines and Energy continues to institute fuel price hikes and as food prices also continue to soar based on announcements made by cereal and bread producers,” says Nandago. “Inflation forecast for 2022 is now 5.6 percent. Overall, rising prices in the economy are a key downside risk to economic performance.”
