By Yosief Abraham Z.,
Following to the declaration of the redemption for Nakfa currency in the fall of last year, the markets in Eritrea have come with new notions of positive remarks. The sharp fall in the prices of consumable goods and other agricultural products have been appealingly magnetizing, and attracts the concern of different quarters.
The first notion which is undeniable is why such immunity in over-inflated market prices has started taking positive direction. In the first place, the limited circulation in the liquidity of money has its own impacts. And stemmed from this, traders who have been the main drivers of the inflation swing has been enforced to deal with the new market notions properly. In fact, the market in Eritrea had been under active guidance of speculators and their collaborators who exploited the market in skewed manner.
To armor this, when the country was ushered with abundant agricultural products in 2014, the society was hopeful to witness stabilized market condition. Unfortunately, to deepen the depth of the inflation quagmires, the traders hurried to store thousand tons of agricultural products in their own depots.
The elaboration of Eritrea’s President in last month interview underpins this fact. Resulted from such incidents, therefore, prices in the market continued soaring high and has played negative role in affecting lives of the citizens.
As crystal clear, market stabilities come true after integrating various functional monetary as well as other related trade policies. While trade and other supporting permits are not still active, however, sharp fails in the conditions of Eritrean markets signifies other trade trends. Speculations played negative role in damnable way thereby for inflating basic agricultural prices. Had it not been this one of the impacting elements, then there could have been other market conditions than the stabilizing routes.
But such signs could be bubbles and evaporates soon if they are not supported by other functional trade policies. In fact, the society is consuming what has been in stocks, and such market stability is witnessed in the notions of agricultural products while other indexes are still intact. Therefore, without entering into deep economic philosophies, partially concealed manner of speculators and the shortage of money liquidity in the market has been triggered the lowest prices in twelve years.
But to ensure this, drafting and implementing supportive trade policies and monetary supervising models expect to guarantee the positive remarks. And jailing the malpractice trade ethics deep inside effective institutionalization working guidelines is the only way that Eritrea can assure it’s already witnessed positive seems but still challenging aspect of stabilizing its marketing system.
In fact, economy stability is most often good in theoretical prophesy than implementing it on ground.