By Emmanuel Nduka
Zimbabwe’s inflation rate has surged in January, climbing by 14.6% in dollar terms and 10.5% when measured in local currency, marking a concerning shift in the country’s economic landscape.
Independent economist Prosper Chitambara attributes this rise to the dual pressures of increased taxes and a regional drought last year, which has led to a sharp increase in food prices.
In response, the Finance Ministry introduced several new tax measures in the latest budget, including a 0.5% tax on fast food and a 10% tax on sports betting revenues.
These changes, which came into effect this month, are expected to further strain the local economy.
Although Zimbabwe launched a gold-backed currency in April of last year, it experienced a significant devaluation by September.
Despite efforts to stabilize the economy, many local transactions continue to rely on foreign currencies, primarily the U.S. dollar.
As of this week, the Zimbabwe Gold currency is trading at 26.3 to the dollar, reflecting a continued decline since its devaluation.
