Rising prices of raw materials: African economies threatened

Although Africa is the main source of most raw materials in the world, African economies are threatened by the high prices of these materials which have become a burden on consumers in the black continent characterized by rising rates of poverty.

After several months of calm, the price increase became once again one of the major concerns of the citizens of several African countries. Economists believe that rising of raw materials' prices, including oil, influences on the main food such as cereals.

Rising raw materials prices leads to higher transport costs and manufacturing. On the other hand, the fact that some countries try to use grain to produce alternative sources of energy puts pressure on the prices of these materials.

In a study on the impact of high prices in Africa, the African Development Bank (ADB) said that development efforts in the black continent, particularly in non-oil producers, threatening to affect the daily lives of African peoples, while a decision to increase salaries can not, except rarely, cover the cost of inflation resulting from higher prices.

The bank said that high oil prices lead to the increase in energy bills, especially in non-oil producers, and therefore entail an increase in the volume of public expenditure in development.

Assadras Ndikumana, Burundi journalist, said that his country lives since last May in a dramatic increase in food prices. He stressed that Burundians believe that the government's promise to increase salaries has contributed to higher prices. According to them, the increase in wages does not go hand in hand with rising prices, prompting unions to threaten to react so "hard" to fight against rising prices, if citizens do not feel the impact of rising wages.

In Cameroon, people feel, in a stronger way, the impact of inflation. Food prices do not cease to grow when Cameroonians have low purchasing power.

In this context, the Cameroonian journalist Boleikarb Assumba said that the people reduced the quality of their meals as the only solution for coping with high prices.

In Algeria, where the country is experiencing a continuous rise in food prices for months, Algerians fear that the price will continue to increase with the approach of the month of Ramadan which reflects the rising rate of consumption.

According to the Algerian National Office of Statistics, the inflation rate was 2,6% in the first half of this year, but economists believe the rate is much higher than official numbers. Malaoui Rashid, a member of an Algerian independent union, argue that prices will rise much more than rising wages. He stressed that the average income in Algeria in 5000 is 11 dinars per month (120 euros), which is not sufficient to meet with the basic needs of the Algerian citizen.

The effect of inflation in Algeria exceeds food to hit all sectors. While Algeria suffers from lack of housing, which should have a positive impact on the construction sector, the price of building materials has come to reverse the impact.

Nowali Said, head of an Algerian construction company, said that the price of cement increased by 150% in the last period, hampering development efforts in the construction sector.

For his part, Emiani Reda, Chairman of the Forum of bosses and ex-Algerian Minister of Small and Medium Enterprises, said that urgent measures must be taken to stop the rising inflation rate in Algeria before arriving at the suspension cycle of development.

To meet with rising prices, the Algerian government is preparing to suspend, temporarily, sales tax, which amounts to 17%, and customs, amounting to 30% on food in hope that this will lead to lower prices of basic foodstuffs.

In Senegal, the Department of Economic Studies estimate that the rate of increases in the cost of the daily life of Senegalese citizen will reach 5,5% to 6% by the end of this year due to rising prices. The department noted that food prices rose by 4,7% over last July only.

In this context, the ADB recommends the African countries who import oil to keep inflation below 10% or the development cycle will stop.