Source Pravda.Ru

Inflation surges 411 percent in Zimbabwe economy

Inflation in the crumbling Zimbabwe economy surged to 411 percent in October, one of the highest rates in the world, the government's Central Statistical Office said Friday. The office said a fall in the value of Zimbabwe's currency was the main reason for the increase from 359.8 percent in September. The Central Bank devalued the Zimbabwe dollar last month from 26,000 to 60,000 to the U.S. dollar.

Acute shortages of hard currency have spurred black market deals that fetch 100,000 Zimbabwe dollars for the U.S. dollar, the AP says.

The official inflation figure is calculated on a basket of foodstuffs and essential goods. The statistical office said goods and services normally purchased by an average household have increased five fold in price since October last year.

The highest price increase last month was on air fares on the national airline, Air Zimbabwe, which rose by more than 1,600 percent, the statistical office said.

The cost of a round trip to London soared to 140 million Zimbabwe dollars (US$2,300) and return flights to the second city of Bulawayo, 450 kilometers (280 miles) southwest of Harare, rose to 20 million Zimbabwe dollars (US$330).

Independent analysts blame the meltdown in the agriculture-based economy on the chaotic and often violent seizures of more than 5,000 white-owned commercial farms since 2000.

The United Nations estimates that at least 4 million of the country's 12.5 million people are suffering severe food shortages. Gasoline shortages have crippled industry and transport services.

The state railroad company said Thursday just 13 of its 175 locomotives were fully operational because of financial difficulties and shortages of fuel, spare parts and equipment.

The government insists drought and sanctions imposed by Western nations have led to the worst economic crisis since independence in 1980.

The U.S. ambassador to Zimbabwe, Christopher Dell, received a formal protest from the Foreign Ministry Wednesday for comments he made about the country's economic plight.

Dell had said government mismanagement and corruption were most to blame for the situation and not, as President Robert Mugabe contends, drought and the limited travel and visa sanctions on ruling party leaders.

T.E.