Thursday, June 18, 2009
I recently commented on how increasing food prices weren't getting enough press. Well, it looks like The Economist was reading my mind. Take a look at their graph below, published in their graph-a-day series.
As you can see, food prices in many developing countries have had increases in the past 3 months. But, even for those that have had decreases in the last 3 months, the year-on-year increase in food prices is substantial. For some reason China is excepted from this trend. The trend in South Africa is particularly worrying. Inflation, by itself is not always a problem, but when combined with the endemic unemployment (and underemployment) and poverty it's an ingredient for a recipe of greater social unrest and economic instability. Zuma and his cabinet are going to have to take on this problem, with the others that they face. Good luck to them.