The Wholesale Price Index (iPG), which measures the variation in the prices of domestically produced and imported goods, showed a significant year-on-year and accumulated increase of 25.49% throughout 2023, according to data from the National Statistics Institute ( INE)
This increase, 6.71% higher than in 2022, highlights a growth trend over the last three years, reversed only from April 2022 onwards. The report recently released by INE points out that, in December 2023, the IPG presented a rate of 2.88%, indicating a slight acceleration of 0.06 percentage points compared to November of the same year. This index, as highlighted by INE, was 1.68 percentage points higher than that recorded in the same period in 2022, pointing to persistent challenges in economic stability.
Detailed analysis of the data shows that the prices of national products experienced an increase of 2.76% compared to the month of November, with the Manufacturing Industry being the main influencer of this growth, with an increase of 2.83%. Items such as beef with (6.91%), wheat flour with (6.88%), goat meat with (5.26%), pork with (4.9%), corn flour with (4.55%) and other products contributed to a combined increase of 31.08%. Meanwhile, imported products also saw their prices rise, registering an increase of 2.92% in November.
Manufacturing industry, with a variation of 2.92%, was the main factor for this increase. This scenario points to the complexity of the country’s economic challenges, with an impact on both domestic production and imports of goods, requiring adaptable strategies to contain inflationary pressures. INE highlights the importance of carefully targeted economic policies to deal with current price dynamics and boost economic stability.
Inflation rises to more than 20% in 2023
The Angolan economy is facing a worrying rise in inflation, ending the year 2023 with a year-on-year rate of 20.1%, according to data recently released by the National Statistics Institute (INE). These numbers confirm the estimates advanced by the National Bank of Angola (BNA) in November, which already pointed to a rate of 19.5%, exceeding the government forecast of 17.8%. The INE National Consumer Price Index (IPCN) report points to an increase of 6.16 percentage points in the year-on-year variation compared to the same period of the previous year, reaching 13.85%.
This significant acceleration of 1.82 percentage points compared to the previous month places the monthly inflation rate for December at 2.42%, the highest of the year. The document analyzes monthly variations in November and December, highlighting an increase of 0.21 percentage points (pp) and 1.55 pp year-on-year. The “Health” sector was identified as the main driver of the increase in the IPCN rate in December, registering a variation of 3.05%, followed by miscellaneous goods and services with (2.95%), food and non-alcoholic drinks with (2.83%) and clothing and footwear (2.57%).
The food and non-alcoholic beverages class was the biggest contributor to the increase in the general price level, adding 1.67 percentage points during the month of December. Next, miscellaneous goods and services represented an increase of (0.21%), Health with (0.12%) and clothing and footwear with (0.10%) also impacted the inflationary scenario. The variation in inflation showed regional disparities, being most significant in the capital city (Luanda), with 3.36%, Cabinda with (1.95%) and Huíla with (1.89%), while the province of Moxico recorded the lowest variation, with 1.34%, followed by Malanje with (1.43%) and Lunda- Norte with (1.45%). In Luanda, the year-on-year variation reached 26.02%, representing an increase of 12.88 percentage points compared to the same period in 2022.
Comparing the year-on-year variation of December with that of November, an acceleration of 3.01 percentage points was observed. According to the report, in the subdivision by classes in Luanda, the “Health” sector led with a price increase of 4.78%, followed by miscellaneous goods and services (4.35%), clothing and footwear with (3.87% ) and food and non-alcoholic drinks with (3.83%). The upward revision of the inflation forecast by the BNA in November last year to 19.5% contrasted with the projections of the World Bank and the International Monetary Fund (IMF), which, in their joint annual meetings, predicted a rate of 18. 8% at the end of 2023, while in March the forecast was 12.3%. This indicator challenges economic authorities to adopt agile measures to stabilize the inflationary scenario and boost the country’s sustainable growth.
BY: Francisca Parente