JOHANNESBURG – South Africans will need to start tightening up their pockets in the next few months with food and fuel prices expected to go up.
The drought and the volatility of the rand have been blamed for their negative impact on imports.
“The prolonged drought is the major factor but there are also other factors at play such as the massive increase in the price of maize which is the staple food for fattening beef before going to market,” said Economist Dawie Roodt.
Prices are expected to rise between 50 and 60 percent, which is going to have a marked impact on consumers.
The country is still experiencing extreme drought effects and that has taken its toll on the production of food.
“The food shortages caused by the severe drought earlier this year have worked (their) way through the economy and the prices of all food have risen substantially,” said CEO of debt management firm Debt Rescue Neil Roets.
“We can expect further increases as the country will have to import large amounts of food such as maize and wheat where producing areas were particularly hard hit.”
Economists have advised consumers to look for alternative ways to curb the sending and seeks debt counselling.
Roets said the deal struck between Iran and South Africa for the supply of crude oil during President Jacob Zuma’s recent visit to that country may bring some relief.
“There are rumours in the oil sector that Iran will be supplying crude at below benchmark prices which could give the economy a bit of a breather,” Roets said.