Business
Reasons behind the rise in prices of essential commodities
Prices of essential commodities have increased triggering panic and worsening poverty
Prices of a number of essential consumer goods in Uganda have shot up in recent weeks triggering anxiety and panic among many ordinary buyers.
Prices of essential goods such as soap, cooking oil and salt have risen by more than 50 percent.
A bar of washington soap that was selling at UGX3500 in November 2021 has now reached UGX6500. A littlre of cooking oil has also increased by about 50% from UGX7000 in August 2021 to now about UGX9000.
Food prices have also edged up slightly on account of the dry spell.
Traders are attributing the hike in prices of consumer goods to the increase in fuel prices and reduction in supply by manufacturers.
The increase in fuel prices witnessed over the last month, has added to transport costs and thereby pushed up the prices of other goods.
Economists argue however that the current rise in prices is a global phenomenon brought about by disruptions in the global supply of raw materials that are used by manufacturers.
Mr. Ramathan Ggoobi, the Permanent Secretary in the Ministry of Finance said the current inflationary pressures are not unique to Uganda but rather a global phenomenon.
Finance PS Ramathan Ggoobi
Reacting to a tweet from one Ugandan about the high prices, Mr. Ggoobi said: “It’s a temporary shock that was caused by disruptions in the supply and value chains due to Covid-19; not peculiar to Uganda but happening in all economies. Now that economies across the world are fully re-opening, the cost of doing business will normalise soon.
The end of transport restrictions, analysts argue, has led to an increase in demand for goods, whose production had reduced during the lockdown as factories cut back on their workforce.
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