Household budgets continue to be under pressure as the cost of living in Kigali increases while the pandemic suppresses incomes.
Some families are opting to move to rural areas with hopes of living affordable lives. The high cost of the living has been compounded by rising prices and weakening Rwanda franc that fell to Rwf1,037 against the dollar last week.
The latest Consumer Price Index report by the National Institute of Statistics indicated that the annual inflation increased by 1 percent from November 2020. “Transport increased by 3.8 percent, education increased by 19.2 percent, restaurants and hotels increased by 3.9 percent, while the energy index increased by 2.9 percent,” reads the report.
The percentages reported reflect the prices on the market that have been hiking since 2020.
For instance, a year ago, Rwf100,000 would pay for a decent two-room house in Kigali, sometimes even less.
“Today, landlords are constantly increasing rent to as much as Rwf200,000 for the same house,” said Abel Kwizera, a house agent in Kigali.
While this is the case, some families are yet to recover from the impacts of the Covid-19 pandemic. It is particularly difficult for individuals who lost their sources of income, either jobs or businesses, but still have to provide for their families.
Theophille Muvunyi’s family is one of those who decided to leave Kigali. “Even if I got another job, it would still be difficult. Prices have changed,” he said. Muvunyi used to earn Rwf180,000 per month before he lost his job in a hotel in March 2021. Along with some side hustles, he was managing to pay Rwf60,000 as rent, Rwf40,000 for his son’s nursery school, Rwf3,000 for electricity per month, Rwf1,500 for water and the rest would go to food and transport.
Today, he needs more than twice the money to afford what he used to pay his bills. His rent was recently increased to Rwf80,000.
“I have decided to move my family to Gakenke district, my place of birth. With the little money I have right now, I can rent a house and a small piece of land there. Food, rent, education, and transport are more affordable there than in Kigali,” Mr Muvunyi explained.
With many families going through the same experience, the impacts of the increasing cost of living do not stop at affordability but also the well-being of the families who cannot afford the basics.
The situation could worsen once some subsidies and incentives by the government are lifted.