By coincidence,many countries are preparing for elections slated for this year. In the US its yet another time when the Democrats and Republicans flex muscles in fierce public campaigns to woo voters as candidates engage in publicized debates on issues affecting Americans like jobs and healthcare insurance; In Kenya politicians are helter-skelter either hoping from one amorphous political party to another or cooking expedient political parties over a weekend retreat in readiness for the oncoming elections.
In Nigeria pundits suspect that the recent declaration by Goodluck Jonathan's government to scrap oil subsidies hitherto enjoyed by a small fraction of Nigerians, are directly related to elections. The government on the other hand maintains that by cutting oil subsidies, its going to save over 8 (eight) billion USD which would be used in other priority areas like improving the dilapidated infrastructure like roads, modernizing the railway transport and improving education among many others. Uganda has also announced that as part of its austerity measures, the government will also reduce oil subsidies in an attempt to cut down on expenditure and save money which could be used in other needy areas like improving healthcare and the construction of infrastructures.
Inflationary rates the world over have skyrocketed forcing people to spend their meager savings in order to stay afloat. The cost of food commodities has also increased tremendously affecting virtually everyone. This is inspite of the FAO's Food Price Index (FFPI)-a measure of the monthly change in international prices of a basket of food commodities- showing that on average, there was a downward trend in the prices of food with the December FFPI dropping 2.4 percent translating to 5 points from November. This trend however isn't felt on the ground by the common man because of a myriad of middlemen hovering like vultures waiting to capitalize on any available opportunity.
The prices of basic commodities like vegetables, cereals, maize and wheat has continued to increase unabated. This upward spiral has squrely been attributed to the recent inflationary conditions that have affected many governments. Banks have increased their lending rates while hoarding the much needed dollars; traders in gas and petroleum products have also reacted to this phenomenon by adjusting their prices to abnormal heights with a knock-on effect which eventually pushed up the commodity prices at the retailer level.
The end cosumer has been forced to bear this burden single handely as many governments continue to engage their exchequers to observe strict austerity measures which involve cutting government expenditures to key public utilities while scrapping in toto areas thought to be dispensable.
The end result has been that many people are facing poverty infront of them since they are forced to spend their meagre resources and savings in order to stay afloat.
Its against this backdrop that many voters will be looking at a candidate who is going to deliver them from this manace. This therefore means that politics as usual cannot be tolerated since the voting patterns this time round are going to be dictated by the people's stomachs figuratively speaking. Politicians therefore have the daunting task of creating jobs for the unemployed, developing infrastructures that'll attract foreign investors, streamlining the financial sectors which have wasted government funds through bailout packages. They will also have to craft laws and policies especially in the agricultural sector aimed at boosting the production levels in order to cushion people from the increasing food prices. This is especially important considering that many developing countries GDP's are driven by the foreign exchange from the agricultural exports and cash crops.
Freezing worker's salaries in an attempt to stem inflation isn't a panacea in itself but rather a desperate intervention that won't take us very far. Some economists have argued in favor of the increase in inflation as a way of resuscitating a collupsed economy. This idea may sound absurd especially in circles where governments have been rendered helpless as the free market economy continues to dictate the demand and supply rates which have a bearing on the inflation rates at any given time but when there are very few options at our disposal any solution is worth trying..
In Nigeria pundits suspect that the recent declaration by Goodluck Jonathan's government to scrap oil subsidies hitherto enjoyed by a small fraction of Nigerians, are directly related to elections. The government on the other hand maintains that by cutting oil subsidies, its going to save over 8 (eight) billion USD which would be used in other priority areas like improving the dilapidated infrastructure like roads, modernizing the railway transport and improving education among many others. Uganda has also announced that as part of its austerity measures, the government will also reduce oil subsidies in an attempt to cut down on expenditure and save money which could be used in other needy areas like improving healthcare and the construction of infrastructures.
Inflationary rates the world over have skyrocketed forcing people to spend their meager savings in order to stay afloat. The cost of food commodities has also increased tremendously affecting virtually everyone. This is inspite of the FAO's Food Price Index (FFPI)-a measure of the monthly change in international prices of a basket of food commodities- showing that on average, there was a downward trend in the prices of food with the December FFPI dropping 2.4 percent translating to 5 points from November. This trend however isn't felt on the ground by the common man because of a myriad of middlemen hovering like vultures waiting to capitalize on any available opportunity.
The prices of basic commodities like vegetables, cereals, maize and wheat has continued to increase unabated. This upward spiral has squrely been attributed to the recent inflationary conditions that have affected many governments. Banks have increased their lending rates while hoarding the much needed dollars; traders in gas and petroleum products have also reacted to this phenomenon by adjusting their prices to abnormal heights with a knock-on effect which eventually pushed up the commodity prices at the retailer level.
The end cosumer has been forced to bear this burden single handely as many governments continue to engage their exchequers to observe strict austerity measures which involve cutting government expenditures to key public utilities while scrapping in toto areas thought to be dispensable.
The end result has been that many people are facing poverty infront of them since they are forced to spend their meagre resources and savings in order to stay afloat.
Its against this backdrop that many voters will be looking at a candidate who is going to deliver them from this manace. This therefore means that politics as usual cannot be tolerated since the voting patterns this time round are going to be dictated by the people's stomachs figuratively speaking. Politicians therefore have the daunting task of creating jobs for the unemployed, developing infrastructures that'll attract foreign investors, streamlining the financial sectors which have wasted government funds through bailout packages. They will also have to craft laws and policies especially in the agricultural sector aimed at boosting the production levels in order to cushion people from the increasing food prices. This is especially important considering that many developing countries GDP's are driven by the foreign exchange from the agricultural exports and cash crops.
Freezing worker's salaries in an attempt to stem inflation isn't a panacea in itself but rather a desperate intervention that won't take us very far. Some economists have argued in favor of the increase in inflation as a way of resuscitating a collupsed economy. This idea may sound absurd especially in circles where governments have been rendered helpless as the free market economy continues to dictate the demand and supply rates which have a bearing on the inflation rates at any given time but when there are very few options at our disposal any solution is worth trying..
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