By:- Amanuel Kindya
The Monetary Policy Committee of the National Bank of Ethiopia, which was established to provide monetary policy recommendations in line with the primary objective of stabilizing prices, has indicated that the inflation rate for the year 2024, especially for food products, has stabilized compared to the previous year.
However, residents of Addis Ababa do not seem to agree with this. They say that there is no increase in prices compared to the previous year.
Economists also say that the increase is observed in all areas, so reducing government spending and focusing on agriculture may help stabilize prices. Residents of Addis Ababa who gave us their comments said that there is no increase in prices compared to the previous year, from oil to onions, from teff to many food and household items.
When asked why this consumer opinion on inflation differs from the recent monetary policy committee of the National Bank of Ethiopia, political economist Shewaferahu Shtahun said, “I am a consumer, so I always hear only about price increases.” The expert said that perhaps the committee’s assessment was seen in the weakening of the purchasing power of the Birr.
The expert did not hide the fact that the government has controlled inflation by reducing its spending and strictly controlling the lending of banks.
However, pointing out that this has its own shortcomings; “But here too, the economy should inject money as much as it can produce,” the expert said, adding, “The government should use institutions such as the National Statistics and Planning Commission to collect information and inject money into the economy so that production can be produced, without neglecting strict monetary policy control.
Political economist Shewaferahu Shtahun advised that in order to control inflation, focusing on the agricultural sector, which can stabilize inflation, especially food prices, is the only solution to avoid unemployment and similar challenges.
