HomeBusiness DigestPDL in line with analysts' predictions

PDL in line with analysts’ predictions

Paul Nyakazeya


THE Poverty Datum Line (PDL) figures for May are in line with analysts’ predictions that the figure could breach the $140 million mark by year-end as the economy continues to deteriorate under increasing inflationary pressures.

The Tot

al Consumption Poverty Line (TCPL) for an average family of five shot to $52 436 800,10 in May from $37 949 305,38 in April, the Central Statistical Office (CSO) said last week.

The new TCPL represents a 38,17 percentage points increase on the prior month’s figure.

“The TCPL for an average family of five stood at $52 436 937,10 in May 2006. This means that an average household required that much to purchase both food and non-food items for them not to be deemed poor,” CSO director, Moffat Nyoni, said.

Analysts who spoke to businessdigest last month said the same basket would be $45 million in May. Their forecast fell short by $7 million.

In June a family of five is projected to require $54 million. In July the same family would require $65 million, and $78 million and $93 million in August and September respectively.

In October, the family would require $112 million and $135 million in November.
 
Independent economic consultant, John Robertson, told businesdigest that if the prevailing trend, under which PDL has been increasing by an average of 20% since January was not reversed, the situation was going to be agonising for a lot of people.

According to the CSO, the current figures confirm that most Zimbabweans are living in poverty as their salaries fall far short of the PDL.

“If this (current) trend is anything to go by, then a lot of families will not afford decent meals by year-end as it is evident that salaries will not be adjusted in line with the poverty datum line,” Robertson said.

Nyoni said the PDL figure is a 28,3% increase on a monthly basis and 1 100,47% on an annual basis when compared to the amount achieved in April 2005 of $220 000 per person. On an individual basis, the TPCL stood at $10 487 279,42 in May from $7 589 861,08 the previous month.

On the other hand the Food Poverty Line (FPL) for May was $17 938 694, which was a 35,86 percentage points increase on the April figures.

The FPL represents the minimum consumption expenditure necessary to ensure that each household member can consume a minimum food basket equal to 2 100 kilocalories in a month.

According to figures made available last week by the Consumer Council of Zimbabwe (CCZ) a low income urban family of six for May needed $49 million, from last month’s figure of $41 million.

CCZ managing director, Roseline Siyachitema, said the cost of vegetables continues to increase, owing to the shortage of local products like onions and tomatoes of which only import substitutes are available.

“In May there were widespread increases on rentals and this impacted negatively on consumers as some of the costs are now beyond the reach of many consumers.

“The supply of sugar continues to be erratic and this continues to push its price up each time it is available on the market,” she said.

The $49 million required by the low-income urban earner reflects that the economic situation prevailing in Zimbabwe is certainly worsening. Living standards for the common man have rapidly deteriorated and continue to decline.

Inflation for May is currently pegged at 1 193,5%.

“The explicit comparison of the wages which some low income earners get and the poverty datum line reflects that some consumers are now forced to forgo some basic food and non-food items owing to their costs thus reducing the quality of the lives of consumers,” Siyachitema said.

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