Inflation, from an economic standpoint, refers to a general increase in prices and fall in the purchasing value of money. In 2018, inflation rates surged for many countries around the globe.
Venezuela
In 2018, the country that has suffered the most from this problem was Venezuela, with an increase by over 200,000%, one of the highest in history. The rate is only increasing, and according to economists, things may get worse in 2019. Venezuela was once the wealthiest country in South America, but it is now struggling. There is no single reason to blame for this because it is a mixture of “corruption, social unrest, self-serving politicians, capital controls, price fixing, and a global commodity bust” (Friesen).
Argentina
Argentina suffered the second most when it comes to an increase in inflation in 2018. In the year 2018, Argentina has had an increase in inflation by 34%. This is due to the fact that the government has printed so much money due to finance budget deficits, causing consumer prices to skyrocket. The president of Argentina, President Macri has raised utility prices to reduce subsidies and to close the fiscal deficit. However, these things contributed to keeping the inflation high. Lastly, there is a drop in exchange rates, which has also contributed.
Turkey
Turkey has suffered the third most from this problem in 2018. In just 12 months, Turkey’s inflation rate has increased by a whopping 24%. This has many of the country’s residents fearful of an economic crisis. This is especially true under the new President, Recep Tayyip Erdoğan. The main reason is that the Turkish lira, (Turkey’s currency) is falling. Political analyst, Atilla Yesilada of Global Source Partners says, “It’s the beginning of the slippery slope. It’s going to get worse unless there is a miraculous improvement in the exchange rate.” Many people have criticized Turkey’s central bank for not raising interest rates, which can cause a turn-around in the economy.
Iran
Iran has suffered the fourth most from inflation in 2018. In 2018, Iran’s inflation increased by 23%. Some of the main reasons include a lack of competition, and monopolies starting to form. Also, government supervision has caused the value of their money to weaken. In June of 2018, the prices of many goods increased by over 10% in a matter of two weeks. For example, a car costing less than $20,000 would go up to costing almost $25,000.
Ethiopia
Ethiopia has suffered the fifth most from inflation in 2018. In just one year, Ethiopia’s inflation increased by 12%. The country has been suffering for many years for various reasons. In 2018, the main reason was due to a surge in food prices. The country blames this on road blockages, and the country not being able to import enough food. This ultimately caused food prices to ascent.
Nigeria
The country that has suffered the sixth most from inflation in 2018 was Nigeria. Nigeria’s inflation rose by 11% in 2018. One of the main reasons is due to the excessive government spending. This has injected too much money into the country’s system, ultimately causing the rise. Other factors include raises in prices of goods, which ultimately caused raises in wages of workers. On top of all this, higher taxes have contributed also.
Philippines
The country that has suffered the seventh most from this problem was the Philippines. In the Philippines, inflation rose by 6.7% in 2018. Although this rise was occurring for almost a decade in the Philippines, 2018 has been a troubling year. President Duterte blames the high prices of oil, but that is not the only reason. Another reason is that to complete many infrastructural projects, the country had to import a lot of materials. The country would choose some more than others, such as iron and steel. That is also a reason why the peso is weakening, which ultimately will worsen this issue.
Pakistan
The country that has suffered the eighth most from inflation in 2018 was Pakistan. Inflation in Pakistan rose by 5.1% in 2018. Pakistan Bureau of Statistics has reported that this surge is the highest the country has seen in over fours years. This is one of the biggest challenges the country’s new leader, Prime Minister Imran Khan faces. The leading causes of this high increase are the rising prices of petroleum products and four rounds of the devaluation of the country’s currency, the Pakistani rupee.
Mexico
The country that has suffered the ninth most from inflation in 2018 was Mexico, with a rise of 4.9%. Mexico has been suffering from an increase in inflation for almost the past two decades. The primary cause now is an increase in gas prices.
Brazil
Last but not least, the country that has suffered the tenth most from inflation in 2018 was Brazil. Brazil had an increase in inflation by as much as 4.5%. There is no apparent reason, as to what caused this. The country’s new president, Jair Bolsonaro is trying to resolve the country’s economy and keep the inflation rates down.
Many countries around the world are facing rises in inflation. The main contributors are the rise in oil prices, a poor economy, and printing an excessive amount of money, which gets added to the system.
