21 September 2010 | Nick Martindale
The Mozambican government has reversed its decision to allow bakeries to increase the cost of bread by up to 30 per cent and agreed to restore prices to August levels.
After days of rioting in which 13 people died and 250 were arrested, the government agreed to subsidise the price of bread, although it remains unclear as to how this will work in practice.
After a cabinet meeting, Aiuba Cuereneia, planning and development minister, said: “The important thing is to know that bread is back to its old price. As for who will receive the subsidy – the bakers, the wheat importers, the distributors – that is a question that the government is solving with the parties involved.”
But international procurement consultant Biryahwaho Ellis said subsidising the price of wheat could only work as a short-term measure.
“If the cause of this is a shortage of wheat, then the foreign companies buying wheat will also be affected,” he said. “Prices will go up again and subsidies will be useless.”
Based in Maputo, Cynthia Donovan, assistant professor in the Department of Agricultural, Food and Resource Economics at Michigan State University, said bakeries and other industries affected by higher wheat prices should consider using other ingredients.
She said: “Research at the University of Eduardo Mondlane indicates that 10-15 per cent of wheat flour in bread can be substituted with cassava flour without major shifts in flavour and texture.”