Rising inflation pinches Kenya's urban poor harder

Kenya's rising inflation is hitting harder the urban poor, pushing many to the edge amid declining incomes and job opportunities.

The growing inflation, mainly caused by sharp increase in prices of food items, stands twice for the poor in comparison to that of middle and high income earners, latest economic data from the government statistics bureau showed Wednesday.

The East African nation's inflation in July stood at 6.39 percent, up from 5.8 percent in June, according to the Kenya National Bureau of Statistics (KNBS).

The food index in July increased by 1.12 percent due to rise in prices of several food items, in particular maize and vegetables.

The cost of a 2kg packet of maize meal increased by 2.3 percent, from 1.08 U.S. dollars to 1.11 dollars.

Similarly, the price of a 90kg bag of dry maize has risen considerably, currently being sold for up to 36 dollars, up from less than 30 dollars about two months ago.

On the other hand, the cost of cabbages rose in July by 8 percent from 0.59 dollars to 0.63 dollars. The price increases are hurting the urban poor in the capital Nairobi twice as much as the high earners, KNBS says.

Besides maize and vegetables, other items pushing Nairobi's poor to the edge are sugar and fuel, mainly kerosene.

Kerosene, which is used by millions of poor households in the East African nation for lighting and cooking, was hit by 0.07 dollars excise duty starting June, making it more expensive.

"Food prices are going up but our incomes are declining. I never look forward to buying food items for my family of three these days," said David Khamala, a stone mason who earns about four dollars daily.

Some analysts attribute the surge in prices of food items to decline in supply and the government introduction of a 0.06 dollar roads levy on diesel and petrol, which are mainly used in manufacturing and transport industries.

"Fuel is the driver of the economy, therefore, any price increase normally has a ripple effect in different sectors, from agriculture to manufacturing. Food item prices will be higher particularly if supplies are low," said Ernest Manuyo, a business lecturer based in Nairobi.

He said urban poor feel the pinch of inflation more because they buy items in smaller portions.

Source : XINHUA