Renowned American economic analyst Steve Hanke says Zimbabwe’s year on year inflation has maintained top position in the world at 848 percent.
Hanke attributes this to economic incompetence by the President Emmerson Dambudzo Mnangagwa led administration.
“Today, I accurately measure inflation in Zimbabwe at a stunning 848%/year, the highest in the world.
“Thanks to President Emmerson Mnangagwa’s economic incompetence, Zimbabwe’s economy is in the tank and Zimbabweans are impoverished,” he says.
The year-on-year inflation rate is calculated by subtracting the value of the Consumer Price Index (CPI) at the beginning of the year from the value at the end of the year.
The result is then divided by the CPI value at the beginning of the year, then multiplied by 100 to get the inflation-rate percentage.
However, the Harare administration through the Zimbabwe Statistics Agency (ZimStat) has over the years been accused of downplaying inflation figures to paint a glossy picture.
Inflation depends significantly on economic expectations of it, making it hard to reduce inflation once it has hit higher levels.
This happened in Zimbabwe in the years approaching 2008, at the end of which a single U.S. dollar was worth over 2.6 trillion Zimbabwe dollars, up from 10,000 Zimbabwe dollars at the start of 2005.
This destroyed Zimbabwe’s economy, leading to very low gross domestic product (GDP) per capita and a government struggling to finance itself.