Guinea

Guinea: President appeals to traders to curb soaring food prices

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CONAKRY, 30 June (IRIN) - A year after food riots shook the capital, the price of rice, Guinea's staple food, is once more soaring beyond the means of ordinary people, but the government appears powerless to control the situation.

President Lansana Conte met with the country's leading rice traders on Wednesday and begged them, in remarks broadcast at length on state radio and television, to reduce their prices.

Conte last year had tried to impose a subsidy on some rice supplies sold in Conakry in the aftermath of food riots in the capital in July, but this time his cash-strapped government offered no such support.

Speaking as several dozen people attempted to stage a protest demonstration against the high cost of living in an outer suburb of Conakry, Conte pleaded with the business community to "take pity on the people and reduce the price of essential goods."

But the ailing president, who suffers from acute diabetes and can no longer walk unassisted, admitted that he could not force market traders and shopkeepers to sell food more cheaply. "I cannot stop you from selling rice at a rate at which you yourselves will lose money. It is not my right. All I ask of you therefore is to have pity on the poor people," he said.

Replying on behalf of the business community, Mamadou Diallo, secretary general of the traders' association, blamed the rapid depreciation of the Guinean franc for a doubling in the price of imported rice over the past year.

He said there was no foreign exchange available from the central bank at official rates, so importers were forced to buy hard currency at inflated rates on the soaring parallel market. "The absence of foreign currency in the central bank has triggered the spiralling prices," Diallo said.

The parallel exchange rate has jumped from 2,800 Guinean francs per US dollar 12 months ago to 4,450 today.

Over the same period, the free-market price of a 50 kg bag of rice has nearly doubled from 60,000 francs to about 100,000 francs. The current price equates to about half the average monthly salary of a civil servant.

Meanwhile, inflation is rising fast, sapping still further the meagre earning power of those Guineans lucky enough to have a job. According to the International Monetary Fund, inflation was running at 28 percent in April up from single digits two years earlier.

"My salary can longer support me and my family of four," complained teacher Yoro Diallo, who has to get by on a wage of 200,000 francs (US $45) per month.

Eyewitnesses said that Wednesday's apparently spontaneous demonstration by people shouting anti-government slogans led to 10 arrests as the police broke it up.

This relatively minor incident recalled memories of more widespread disturbances in July last year, when crowds of several hundred angry people looted rice trucks in downtown Conakry and gangs of youths went on the rampage, threatening to break car windscreens unless drivers gave them money.

Conte reacted then by ordering rice to be sold at a controlled price of 40,000 francs per bag, with a limited quantity being made available to the city's poorest people at 26,000 francs.

However, the scheme was a failure. Prices soon shot back up and the president subsequently fired about 100 local government officials who had been put in charge of the scheme to distribute cheap rice.

It is not just food prices that have shot through the roof in Guinea lately.

Fuel prices rose by 55 percent in May with an immediate knock-on effect on public transport prices. Trade unions reacted by demanding a four-fold increase in wages.

"There is no way a country can survive under these conditions," one western diplomat told IRIN after watching Conte's televised plea to traders to lower their prices on Wednesday.

The president is a former army colonel who came to power in a 1984 coup. He has ruled this West African country of eight million people with an iron hand ever since.

Diplomats, aid workers and UN officials are worried about what will happen to Guinea when Conte, now aged 71, finally departs the scene. He has no obvious successor, the opposition is splintered and weak, and the country is deeply divided between three main ethnic groups.

"Guinea risks becoming West Africa's next failed state," the Brussels-based International Crisis Group (ICG) warned in a report on the country earlier this month.

The country contains a third of the world reserves of bauxite, the mineral ore refined to make aluminium. It also has gold, diamonds and large unexploited reserves of iron ore, as well as enough rain to give it vast agricultural potential.

But diplomats and aid workers say that poor governance and rampant corruption have led to years of economic decline. According to the United Nations Human Development Index, Guinea is among the world's 20 poorest countries.

[ENDS]

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