Shocking new statistics show that Zimbabwe's hyperinflation has reached the 11 million percent mark in June. Some say the actual figure is even higher.
Zimbabwe's hyperinflation is making it difficult to buy food
Zimbabwe's Finance Minister Samuel Mumbengegwi blamed the surge in inflation on rising food prices and Western sanctions targeting the country's ruling elite in an interview on Tuesday, Aug. 19.
Mumbengegwi said Zimbabwe was not the only country to suffer inflation and placed part of the blame on the increasing use of biofuels.
"While our case has been aggravated by the illegal sanctions imposed by the Western powers, rising food prices are a world phenomenon because of the use of biofuel," said Mumbengegwi.
Price controls continue
"But we will continue to fight inflation by making sure that prices charged are realistic," he said, referring to controversial government price controls on some foods, which critics say are forcing producers to shut up shop, worsening dire food shortages.
In a statement circulated on Tuesday, Zimbabwe's Central Statistical Office said inflation had hit 11.2 million percent in June, the world's highest.
The rate compares with an official inflation figure of 2.2 million percent for May, a figure that had been deemed unrealistically low. Some analysts say 11.2 million per cent is also conservative.
Last week, one of the Zimbabwe's leading banks - Kingdom Bank -estimated inflation now exceeds 20 million percent. The locally-owned bank predicted tougher times ahead for Zimbabwe in the absence of donor support and foreign investment.
Faced with critical cash shortages, Zimbabwe's Reserve Bank at the end of July slashed ten zeroes from the Zimbabwe dollar. One US dollar was fetching up to 800 billion Zimbabwean dollars at the time.
Zimbabwe, once the breadbasket of southern Africa, has been in economic free fall since President Robert Mugabe embarked on a chaotic land reform program in 2000 that severely damaged commercial agriculture.
Mugabe has blamed European Union and United States sanctions targeting mainly him and other members of his Zanu-PF party for the situation.
Analysts say the crisis has worsened following Mugabe's disputed and violent re-election in a June 27 presidential run-off that was boycotted by his challenger Morgan Tsvangirai because of violence against his supporters.
Political stalemate continues
A summit of southern African leaders in Johannesburg at the weekend failed to convince Mugabe and the donor-backed Tsvangirai to agree on a government of national unity, seen as the only solution to Zimbabwe's woes.
The two leaders disagree on what powers Mugabe would retain if
Tsvangirai becomes prime minister.
Western powers such as Britain and the US are standing by to plough money into Zimbabwe's reconstruction, but only if Tsvangirai, who took the most votes in the last credible presidential election in March, takes over the reins of power.