Madagascar Is Feeling The Inflationary Effects Of The Russia-Ukraine War

1. Madagascar Is Feeling The Inflationary Effects Of The Russia-Ukraine War Malagasy people remain resilient and are hesitant to speak about the dramatic rise in the price of market goods in Madagascar since the beginning of 2023. However, the country's high cost of living necessitates government intervention. Rice is an important part of the Malagasy diet. Rice is essential to life; it is not only a staple food, but also an important part of Malagasy culture and philosophy. A saying mentions, “It is only with rice that we can be full.” However, only a few households are currently able to purchase the necessary food. Eighty-one percent of the population lives below the poverty line, forcing them to tighten their belts even more. Most people have had to cut back on their spending, and some are going hungry as a result. Even people in the middle class have been hit hard. They, too, must take cost-cutting measures. Price Increase Observed The rate of inflation had already reached 9.3 percent by August 2022. This is expected to rise further this year, according to economists at the National Institute of Statistics (INSTAT). In fact, since January, there has been a significant rise in the cost of foodstuff. In just one week, the price of 1 kg (2.2 lb) of rice rose from MGA 3,200 (USD 0.7373) to MGA 3,600 (USD 0.8294). The current price is MGA 4,100 (USD 0.9446). The cost of 1kg of rice in the year 2019 was USD 0.41 compared to USD 0.89 in 2023.

2. Causes of inflation Due to its inability to produce enough supplies to support its population of almost 27 million people, Madagascar is economically dependent on imports from other countries of basic commodities. Adverse weather conditions, as well as the state of its road networks, have a significant impact on the cost of certain products. This is also due to a lack of awareness and oversight by state authorities regarding market prices. Not that the government lacks knowledge in this regard. The problem of inflation is not limited to Madagascar. Production has been decreased as a result of the conflict in Russia and Ukraine and the series of cyclones that hit Madagascar. The State thereby has to recourse to import rice in Madagascar. The economy of the nation is also vulnerable to unfavorable international economic conditions, which have been severely impacted by inflation as a result of the Russia-Ukraine war. Since Ukraine provided 30% of the world's Wheat Sellers, the price of this essential agricultural product skyrocketed after Russia invaded Ukraine in February 2022. Confined Remedies The State Procurement of Madagascar, a business that imports basic goods directly, has already been established by the Malagasy government. The government has also established emergency social measures in the fokontany (districts), such as "Vary Tsinjo" (in which rice is imported and sold at a discount) and "Tsena Mora" (a program to provide subsidized basic goods). As a result, families can purchase rice for a fair price. If you are a wheat importer wishing to buy wheat in bulk or a wheat exporter willing to Export Bulk Wheat, then Tradologie.com is the right platform for you. Tradologie is a Software as a Service platform that facilitates bulk agro-trade across the globe. Through Tradologie’s interface, buyers can avail the best qualities of agro-commodities at negotiable rates. The transaction-oriented platform has 600,000+ verified buyers and about 70,000+ registered sellers of agro-commodities from over 150 countries. To register as a buyer, click here. To register as a seller, click here. To stay updated with the latest happenings in the agro-trade industry, follow Tradologie.com across all social media channels.