Impact of the depreciation of the Congolese franc on the prices of meat products sold on the Kisangani markets

Abstract

The overall objective of this investigation is to assess the effect of the depreciation of the Congolese franc against the US dollar on the prices of foodstuffs, especially meat products available in the Kisangani market in the Democratic Republic of Congo. At the end of this research, we evaluated the behavior of exchange rate variation on meat product prices, the elasticities and the correlation between these two variables. Analytical and statistical methods associated with the documentary technique were used for data collection in official documents and publications of the National Institute of Statistics and the Central Bank of Congo. Time series analysis using simple regression and ratio calculation allowed for the interpretation of the results. At the end of this research, it was found that the price indices for meat products, namely beef, pork, smoked meat (monkey meat) and live chicken, are generally on the rise in the time series. The exchange rate index, on the other hand, has increased exponentially (±27.2) compared to the average. Concerning elasticities, a 1% increase in the exchange rate led to a price increase of more than 1% in a few years during the study period. While an exchange rate increase of 1% resulted in a price decrease of less than 1% for the products under review in the years 2013, 2015 and 2017. The analysis of the results of the coefficients of the simple regression line revealed the existence of a positive correlation between the exchange rate and the average price of the products studied of the order of 74.5%.

Keywords: Effect, depreciation, Congolese franc, price, meat products, Kisangani market