Global price rises jar Zanzibar paradise

STONETOWN, Zanzibar (Reuters) - Clasping his homemade harpoon gun in one hand, Kassim Vimbi dives noiselessly into the emerald water off Zanzibar.

Harpoon fishermen walk to work across the white flour-fine sand of Paje beach in Zanzibar June 1, 2008. REUTERS/Hereward Holland

Moments later he surfaces, gasping for air, brandishing a writhing octopus over his head in triumph. The dying cephalopod showers him in purple ink.

Normally, Kassim, 25, sells his spoils to local restaurants serving the tourists who visit the island’s palm-fringed platinum beaches. He buys rice for his wife and three children with the proceeds.

But the local price of rice has doubled over the past year as world prices have soared.

Like his neighbors, Kassim can now afford only half the amount he bought in the past, sharing the predicament of many across Africa who find their already limited purchasing power has tumbled as food prices have risen.

Zanzibar, a tropical freckle in the Indian Ocean, 35 km (22 miles) from the Tanzanian mainland, is a net importer of food and therefore particularly vulnerable to price increases.

“At the moment we have a global food crisis. We don’t produce much. The demand for rice is far higher than domestic production,” said Hamis Mussa of Zanzibar’s Finance Ministry.

Tanzania’s gross national income per capita was estimated at around $350 in 2006 by the World Bank.

As Kassim walks home along the beach, weaving past the sun-scorched bodies of aid workers on leave from the continent’s disaster zones, he articulates his troubles in broken English.

He used to get a good price for his octopus catch in Stonetown, the island’s capital and a UNESCO World Heritage site. But rising petrol prices now make the trip too expensive.


Kassim has little grasp of the vagaries of world markets that depend on economies and trade on the other side of the world as well as the expectations of market speculators.

In March, semi-autonomous Zanzibar’s government responded to food prices rises by scrapping its customs tariff and banning all rice exports.

More recently, it asked the East African customs union to cut import duty on rice to 25 percent from 75 percent. But such a change needs agreement from five governments and Zanzibar has had no luck so far.

Zanzibar says the move would only be temporary. Some argue the reform is long overdue. Others say tariffs are essential in the long run to protect local farmers.

“Usually these import tariffs are used to protect the domestic industry ... It’s also an additional source of revenue for the government,” said Jens Tholstrup, executive director of UK-based consulting firm Oxford Analytica.

“In a time of real pressure, when people are going hungry because they can no longer afford food, the argument for having import duty is pretty thin,” he told Reuters by telephone.


Commodity prices have been driven higher by increasing populations and rapid economic growth, particularly in Asia. The use of some food crops for biofuels has also boosted demand.

The weakness of the dollar in recent months, combined with inflationary pressures, has meanwhile encouraged investors to buy into commodities such as rice, oil and gold.

Export restrictions and tariffs imposed by some food producers, worried at possible shortages, have helped propel prices higher still.

Aid workers say the price rises are intensifying a festering crisis in the Zanzibar archipelago, obscured at first glance by its appearance as a picture-postcard paradise.

Caroline Naune of British charity Save the Children says more than a thousand households face chronic food shortages in the fishing communities on northern Pemba island.

Short rains failed at the end of last year, she told Reuters. That is the time residents would normally have planted cassava and sorghum to last them through April-June.

Fish sales were also affected by post-election violence in Kenya at the start of this year -- the peak fishing season.

“In the same period, food prices in the local market went up between 35-170 percent for basic food commodities,” she said.

Import tariffs and financial markets could appear abstract and incomprehensible in the everyday life of a harpoon fisherman, who earns just a few dollars on a good day.

But for Kassim, the threat of escalating prices is far more menacing than anything he has to brave in the deep.

(Editing by Daniel Wallis and Matthew Tostevin)

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