John Muhire, a long time tenant in Kacyiru, is unhappy with his landlord for increasing rent yet the house he stays in has not been refurbished.

Muhire who used to pay Frw200,000 since the year began has received a notice to pay Frw300,000 starting September.

But his major worry is the fixed monthly income, he was not willing to reveal.

"Salaries are not increasing. It’s like we are working for basic needs; accommodation, meals and school fees,” he laments.

To survive, he borrows money monthly—thus he is tied in a vicious circle of debts.

However, landlords claim they have less influence on rental fees. They reason that the increasing prices of construction materials force them to hike the rent charges.

As energy prices continued to rise, inflation was up again in July, partially due to higher energy costs. For example at the pump, fuel prices are Frw926.

Yusuf Murangwa, the Director of Economic Statistics supports the landlords, "Increasing prices for building materials on the market are also another setback.”

Rwanda’s inflation on annual average has risen from 8.9 per cent in the month of June to 9.8 per cent during the month of July, the highest the country has experienced in a period of 12 months.

Data from the National Institute of Statistics of Rwanda (NISR) puts the prices index at 170.7, in the month of July—3.36 per cent higher than the previous month at 165.2.

The increase in the consumer prices index, according to NISR is primarily due to the increase in prices of food and non-alcoholic beverages, which rose by 4.22 per cent.

James Musoni, Finance and Economic Planning Minister, attributes the high inflation rate to low investments in energy, education and transport sectors.

Economic gurus say these are crucial sectors to tame soaring prices.

Prices of housing, water, electricity, gas and other fuels also increased by 3.08 per cent.

The July report says health services costs increased 2.45 per cent, transport over 6.27 per cent and restaurants and hotels 3.56 per cent.

Prices of bread and cereals increased by 2.88 per cent, meat 2.20 per cent, fish 12.88 per cent, legumes 4.79 per cent. This largely accounted for the 4.22 per cent price increase of food and non-alcoholic beverages.

In annual change, the increase in the general index of 18.28 per cent is mainly due to the rising prices of food and non-alcoholic beverages of over 23.03 per cent.

This comes a few weeks the central bank released the monetary policy and financial stability statement for the first quarter of the year 2008 was released.

François Kanimba, the National Bank of Rwanda (NBR) governor, said that the consumer price index is mainly driven by some external factor especially the global increase in oil and food prices.

Local goods increased by 16.49 per cent on annual change with a monthly variation of 3.64 per cent, while prices of the imported products have risen by 24.61 per cent on annual change with a monthly change of  above 2.86 per cent.

Prices of the fresh products had a positive annual change of 13.63 per cent between July 2007 and July 2008.

Control
Musoni, recently noted that increasing food production in the first half of 2008 has helped to keep inflation low.

There was a 16 per cent and 19 per cent increase in food production for season A (November 2007-January 2008) and Season B (May-July2008) respectively.

Monique Nsanzabaganwa, Minister of Trade and Industry said that a conducive business environment for increased investment and increased production is important in curbing inflation.

"The government has initiated a comprehensive set of reforms to the environment in which businesses operate, including institutional and legal reforms,” she said.

She added that taxes on agriculture output are prohibited and the number of intermediaries has been reduced.

The minister believes that publication of food prices in the Media, consultative meetings with food importers will improve productivity and increase supply of goods and services in the market place.

Ends