Minister Kasaija blames high commodity prices on COVID-19 and Ukraine-Russia conflict
We are monitoring the price increment and we shall respond with appropriate policy interventions- Finance Minister Kasaija.
While addressing the Media on Tuesday about the rising prices of essential commodities in the country, the Minister of Finance, Planning and Economic development Hon. Matia Kasaija informed the public that the government is working around the clock to ensure macroeconomic stability and affordable cost of living for all Ugandans.
At the beginning of March, Ugandans experienced hikes of prices in essential commodities including soap, cooking oil and fuel which have since caused alarm and debates in the middle class and peasants across the country.
According to the Minister, the recent price hikes in are as a result of the covid19 pandemic that struck the world and disrupted the supply chain globally and also the geopolitical tensions happening now in Europe with the Russia- Ukraine war.
“We are going to ensure that we take advantage of this global crisis to boost our import substitution and industrialization strategy to support the private sector” Kasaija said, emphasizing that this is to give room for their support to the private sector to produce domestically some of the intermediate goods used to produce most of the affected goods.
According to information from the Uganda Bureau of Statistics (UBOS), cooking oil has registered the highest rise in price and since December 2021 to February 2022 with a 21% hike followed by the hikes of laundry bar soap with 20% and then those of fuel by 15.3% which has led to the Consumer Price Index for February increase from 2.7% to 3.2%.
“Ugandans should also know that according to the global trends triggered by the inflation everywhere in the world, Ugandan prices are much lower compared to those in the market” he added.
Kasaija also added that the hikes in prices is also caused by the full reopening of economies world wide that has also rised the demand of a number of first moving goods yet production levels have been constrained by the covid19 pandemic.
In response to this ongoing situation, Kasaija noted that the government through the Bank of Uganda will continue to monitor the situation and respond whenever necessary with appropriate monetary policy and maintain macroeconomic stability.
In addition to that, Kasaija added that the government is to continue on its journey of supporting farmers to grow more food and vegetables, supporting the citizens and businesses to recover their sources of livelihoods through Emyooga and PDM and also benchmarking on the approaches taken by the neighbors in the region to ensure that the fuel price movements are a true reflection of the economic environment.