Food prices bite: More than double in 10 years

The cost of living in Namibia has become unbearable for most households, with some food prices having more than doubled over the past decade.

With high inflation rates and low wages, the increase in the cost of living has hit low-income households the hardest.

Joson Thomas (43), a resident of Keetmanshoop was employed as a gardener in 2013, earning a monthly salary of N$650.
His wife worked as a domestic worker, earning N$80 a week.

Together, they struggled to provide for their family, with the high cost of school uniforms and food adding to their financial difficulties.

“The price of food has been hard on us. Every year the prices continue to increase, but our salaries do not match these prices,” Thomas says.

Today, he is employed at a retail shop, earning N$1 300 per month. While this is an improvement on his previous salary, Thomas says it is still not enough to keep up with the rising prices of essential items.

“Food has increased, then there is water and electricity. Life is hard,” he says.

The prices of essential food items, such as bread, rice, chicken, maize meal, cooking oil, sugar, macaroni, baked beans, and milk have seen drastic increases over the last few years.

A 2,5kg bag of rice which cost N$16,99 in 2013, now costs N$46,99, while locally produced 2kg mixed portions of chicken have increased from N$48,99 in 2013 to N$94,99 per 2kg pack in 2023.

The Top Score brand, a popular locally produced maize meal and staple food item, has increased from an average price of N$17,95 in 2013 to N$42,49 for a 2,5kg pack.

Additionally, a 750ml of cooking oil has seen an increase from N$12,99 to N$29,99 between 2013 and 2023.

Other items, such as a 2,5kg pack of Marathon Sugar, have increased from an average price N$21,79 to N$42,99 during the same period, while a 3kg pack of Pasta Polana macaroni has increased from N$39,99 to N$97,99.

Baked beans also saw a significant increase from an average price of N$5,99 per can to N$16,99, while a litre of milk increased from an average of N$10,59 to N$19,99.

Washing powder has seen an increase from an average price of N$24,99 to N$45,99 today per 1kg pack.

‘DEVASTATING’

Social and economic justice activist Rinaani Musutua says rising food prices have a devastating effect on the already impoverished citizens of Namibia, pushing them further into extreme poverty.

“With the cost of living increasing, more struggling Namibians will be pushed into extreme multidimensional poverty, and will struggle to afford basic human necessities. People will spend more money on food, which takes away spending on healthcare, education and transport,” she says.

Musutua says the government is not regulating prices and leaves it to the private sector to price products.

She says high levels of poverty lead to increased crime, which could eventually lead to civil unrest.

“There is no peace on an empty stomach,” Musutua says.

THE COST OF INFLATION

Jesaya Hano-Oshike, an investment consultant at RisCura Consulting, says rising input costs have led to high inflation in Namibia.
The country’s current inflation rate stands at 7,2%.

He says Namibia has no control over the prices of these input costs, which are driving up inflation.

“Namibia is a small economy that imports most of its goods, so global economic factors have negatively impacted the country as well. The rising prices of many goods and services have been experienced by the people of Namibia, making it difficult for them to afford the basic necessities of life,” he says.

Hano-Oshike says if wages do not keep up with increasing inflation, the ordinary person on the street would buy fewer goods and services, leading to a decrease in their overall quality of life.

This would also have a negative impact on businesses, as their sales figures would decrease.

“Unfortunately, if wages were to rise, this would increase the input costs of businesses, leading to another round of price hikes,” Hano-Oshike says.

Additionally, the monetary policy of many central banks, including Namibia, has an inflation-targeting objective, meaning a rise in inflation would lead to a rise in interest rates.

Arney Tjaronda, an analyst at High Economic Intelligence, says the cost-of-living crisis has been heightened by inflation, supply chain disruptions, unemployment and some government policies which fail to address ongoing issues.

Tjaronda says to make matters worse, the currency exchange between the United States dollar (USD) has been rising against the Namibia dollar since 2006, from one USD costing N$6 to N$18,12 on Wednesday.

“Assessing this, one can see how our purchasing power has become so weak over time, since the US dollar is the primary currency used in international trade and the global financial system, particularly for cross-border transactions and lending,” he says.

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