Food prices skyrocket in Democratic Republic of CongoJun 29, 2009
Some customers at the central market in the capital city, Kinshasa, say they do not understand why food prices are rising so rapidly and so fast. “All the prices have increased,” one of the regular customers at the market said. “The price of cassava flour and sugar has gone up by about 25 percent, and even though bread is the same price, its weight has significantly decreased. How will we live with this situation?
The fall in global commodity prices has hit the country especially hard, as the country depends heavily on revenues from exports such as oil, timber and copper. Following the closure of several companies in mineral-rich Katanga Province, government revenues and the Central Bank’s monetary reserves have fallen. Congolese francs trading at 500 per US dollar weakened to 800, raising the prices of food and other goods and services. Such volatility makes it difficult for business owners to set prices for their products, while families are losing their purchasing power.
In response to the crisis, the government has tasked a newly-formed commission with finding ways to mitigate these effects. But despite progress in stabilising the currency, the cost of staple foods is still high: some prices have double or tripled. UNDP is working with the government to respond to the social impact of the crisis, and to explore ways of diversifying the economy, by for example, investing in agriculture.