Kiev - Annual inflation in the former Soviet republic Ukraine is in excess of a blistering 30 per cent - bad news indeed for what had been one of Europe's biggest economic success stories of the last decade. Prices for Ukrainian goods and services shot up 3.1 per cent in April alone, the State Statistics Committee reported Wednesday. The number, only a slight drop from March's even worse 3.8 per cent jump, places Ukraine on pace for the world's third-worst inflation rate after Zimbabwe and Iraq, according to 2007 statistics.
Manufacturers passing on increased energy costs to their customers have led the wave of hikes, with Ukrainian-produced goods jumping 6.8 per cent during April, and currently on track to rise 50 to 60 per cent by the end of the year, according to government data.
Retail goods and services price rises are hammering Ukrainian consumers as well, with food and beverages leaping 5.2 per cent during the previous month. Ukrainians on average spend two thirds of their incomes on what they eat.
Rising world foodstuff commodity prices, Ukraine's closed agricultural commodity markets, and stockpiling are the most common causes for the grocery price spikes mentioned by Ukrainian officials and economists.
The worldwide plummet of the US dollar, to which the Ukrainian currency is pegged, has at once undermined billions of dollars of Ukrainian savings, but done little to reduce imported good prices as most Ukrainian markets are protected from most foreign competition, Korrespondent magazine reported.
President Viktor Yushchenko in a speech to parliament last week called for "drastic measures" to hold down the inflation. Uncontrolled price rises have long been feared in Ukraine, where during the early 1990s hyperinflation topped 1,000 per cent.
Runaway prices this year already have cancelled
