By: Seringe ST Touray
The Gambia is facing economic challenges as inflation hit a record high of 18.5% back in September, according to the Finance Minister during his budget speech last week. The surge is attributed to global food and energy price increases, along with strong domestic demand.
“This situation was aggravated by the balance of payments [which have been] negatively affected by high food and fuel import bills, disruptions of cashew and elevated freight costs,” Minister Keita said.
The minister highlighted the adverse effects on the country’s macroeconomic fundamentals, including foreign exchange shortages and pressure on the Dalasi.
The Central Bank reported a moderate depreciation of the Dalasi against major currencies, further exacerbated by disruptions in cashew production and elevated freight costs. Inflation’s impact includes eroding household purchasing power, restricted credit to productive sectors, and geopolitical tensions.
The Finance Minister anticipates a decline in global headline inflation but acknowledges the challenges posed by the cost of food and fuel, influenced by global factors and the conflict in Ukraine.
