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Somalia: Special situation briefing for humanitarian actors

Pays
Somalie
Sources
SADO
Date de publication

RAMPANT INFLATION ADDS TO THE SUFFERINGS OF VULNERABLE COMMUNITIES IN SOUTH GEDO ALREADY PARALYSED BY ALMOST TWO DECADES OF CIVIL STRIFE AND CONSECUTIVE DROUGHTS AND FLOODS

1. General Highlight

Over the past months, a surge in food, fuel and other commodoties prices have created a historic inflation in the whole of Gedo Region direly complicating the livelihoods of thousands already paralysed by almost two decades of civil strife, lawlessness and other natural disasters. The region is not the only affected region but the inflation crisis is a nationwide factor affecting the lives of millions. And the fact that there is no effective central that can control this appaling hyper inflation, the entire country might be on the edges of an economic catastrophe.

Apparently, the inflation has been hard felt in the entire six regions of Gedo region deepening the crisis more in the populous towns like Bardera. For many people living in the region that was previously affected by massive loss of livestock and reduced cropduction due to droughts and floods, this hyper-inflation is deteriorating the livelihoods of thousands of middle and low class groups in Gedo. The fragile coping mechanisms of the locals has apparently failed to resist this critical inflation.

In the main markets in Bardera and Bulla-Hawa, the prices of the imported markets increase with each passing day. The imported goods have increased by an average of 300% while the locally produced stuffs have increased by 400-500% in all the major markets in the region. The prices of the local produces increased more than the imported foods because of increased depedency on local products and the lack of affordability by the lower and middle ranks to purchase imported goods.

In the local exchange market, a dollar is worth Ssh 37,000 while a month ago it stood at Ssh 24,000. The shilling is all time low in all the main markets in Gedo region. The table below indicates the prices of some local and imported products in Bardera market a week ago:

Item
Current Prices in Sshs per Kg
Previous Normal prices in Sshs
In increase Sshs
Sugar
30,000.00
16,000.00
14,000.00
Flour
40,000.00
12,000.00
28,000.00
Rice
48,000.00
14,000.00
34,000.00
pasta
52,000.00
20,000.00
32,000.00
Oil
70,000.00
16,000.00
54,000.00
Maize
22,000.00
6,000.00
16,000.00
Sorghum
18,000.00
5,000.00
13,000.00
Cow peas
42,000.00
8,000.00
34,000.00
Semsem oil
80,000.00
20,000.00
60,000.00
ghee
210,000.00
80,000.00
130,000.00

The food prices and the dollar exchange are not proportionate and this indicates that most of the locals in the region are earning less and spending more on food commodities.

The appalling inflation in the region and the country in general has been caused by three main factors:

1) An uncontrolled printing of Somali shillings reportedly done by some Puntland businessmen that has flooded markets countrywide.

2) The significant strength of the dollar against the Somali Shillings and this is due to the printed shillings.

3) The increasing insecurity in Mugadishu and specifically the unrests in the Bakara Market - the major commercial supply centre for the South and Central regions.

But however, there are some other critical factors that has added to the inflation woes of the locals in Gedo region turning the situation more severe. They include:

1) Attempts by businessmen holding or hoarding commercial commodities for fear of running out of supplies or getting better prices amid the rainy season since the supply routes will be cut off.

2) The seasonal GU rains cutting off the supply route between Mugadisho and the region, hence increasing more the prices of the local commodities.

3) Businessmen targeting the local products (Sorghum and maize) and transporting them to Shabelle and Juba regions due to shortages of local products in these areas.

The economic crisis is gradually testing the lives of the better off groups in the region while it seems to leave the middle and lower ranks in an unforecasted humanitarian crisis. Apart from the rural food economy groups who have been struggling with livelihood crisis over the past years, the urban community who remained stable over the past decade are now drastically feeling the impacts of the economic crisis. An urgent need is required to quell the deteriorating situation in the region.