afrol News, 16 July - Zimbabwe's annual rate of inflation has reached a new record high, registering 2.2 million percent, the Southern African country's Central Bank Governor has confirmed.

Governor Gideon Gono, who made a brief address in the capital Harare ahead of President Robert Mugabe's speech said, "Statistics provided by the Central Statistical Office (CSO) indicate that it is now at 2.2 million percent."

In February this year, the government put the inflation rate at around 165,000%.

The head of the CSO, Moffat Nyoni, confirmed the figure but was quick to add that it only represents a rough barometer. He said since the figure was based on "limited data", his office would not "normally publish such materials with confidence."

"The information was based on fewer observations than we would be confident with due to scarcities," Nyoni said.

President Mugabe had earlier said the increasing levels of production was vital in the government's untiring efforts to control the world's highest rate of inflation.

"As a country our declared battle against the scourge of high inflation must be accomplished," he said, believing that "the more goods we have, the less demand there will be ... Once demand is satisfied, then prices will begin to fall."

Mugabe blamed Zimbabwe's economic problems on sanctions imposed by the West. "We must be of one accord. The sanctions must be defeated," he said.

For many decades, the former Rhodesia has been a food basket for the Southern African region, but its numerous gains were, among others, soon melted by the Mugabe government's controversial land redistribution programme.

Zimbabwe's inflation first reached a record 1000% level in May 2006. Since then, the government's several measures to contain inflation rates bore nought. In this regard, shops and businesses were ordered to halve the price of basic goods last year.

The extreme inflation has also left the government with nothing other than allowing the Reserve Bank of Zimbabwe to print new banknotes. It appears this too has met the rock as evidenced by the bank's German paper supplier's heed to the Berline boycott calls. From 1 July this year, the Munich-based company Giesecke & Devrient GmbH decided "to cease delivering banknote paper to the Reserve Bank of Zimbabwe with immediate effect."

The company's decision was "in response to an official request from the German government and calls for international sanctions by the European Union and United Nations."

"Our decision is a reaction to the political tension in Zimbabwe, which is mounting significantly rather than easing as expected, and takes account of the critical evaluation by the international community, German government and general public," explains Karsten Ottenberg, Chairman of the Management Board and CEO of Giesecke & Devrient.

By staff writer

© afrol News

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