There is a joke circulating around town that demonstrates the level of desperation felt by the public due to the ever rising cost of living.

It goes like this: One of the eight children of an old man, who depends on a 180 Br monthly pension pay out, asked his father for 10 Br. The father questioned the young boy's need for the money.

"There is a magic show at our school," responded his son. "I was told the entrance fee is only 10 Br."

The old man could hardly understand why his son was interested in watching the show.

Asks the father: "Why would you need to go to school to see a magician? Here I am. My ability to juggle my meagre income to support my family is nothing less than magic."

For many people, particularly those Ethiopian urbanities in the fixed income bracket, surviving today's runaway inflation is as good as a miracle. This is what Robert Zoellick, president of the World Bank, described as the daily struggles, sacrifices and survival tactics waged by close to two billion people across the world. This represents two thirds of the world population; reactions in certain countries - such as Haiti, Egypt, and Burkina Faso - have become violent and bloody.   

For emerging countries across the world, bills on the imports of oil and food constitute over half of their annual spending. The era of cheap food in the world is over, according to analysts.

That is very true of any household in Ethiopia where food claims 60pc of the total spending. Many in Ethiopia are unfortunate enough to be in this seemingly endless struggle. The price of food in has jumped to 26.6pc in April 2008, according to the Consumer Price Index (CPI) released in May by the Central Statistical Agency (CSA). Ethiopia's annual inflation of 17pc in 2007 was the highest figure registered in 10 years, and in Africa, with the exception of in Guinea and Zimbabwe, according to the IMF.
 

For a country that spends close to 2.1 billion dollars annually paying for its imported oil, the forecast by Goldman Sachs, a well known international consulting firm, that the price of oil will go as high as 200 dollars per barrel, does not spell good news.
 

The response from Ethiopia's policymakers came much too late. Unlike in the past, where they used to argue - rather passionately - that inflation was a result of growth thus could only be fended off through accelerated growth, now they have declared it to be the monstrous scourge they are determined to fight.

As belated as these responses are, they were too few to bring a marked difference. Despite an increase in broad money supply by an average of 20pc a year, thus begging for the central bank's bold move in tightening interest rates, those in the political establishment preferred to blame and harass businesses instead, with a temptation to control prices and intensify expensive subsidies on edible oil and wheat, in order to cap inflation. They even decided to ban exports of grains such as teff, a frantic measure not peculiar to Ethiopia but adopted by several other countries in Asia and Latin America.

This will again prove to be a wrong move, for the inflation that is rocking the world is not temporary, caused by supply shock that could be met in a short period; and speculation that may bring about a turn around soon. If you were to ask Muhammed Yunus, managing director of Grameen Bank, for all indications, the rise in commodity prices is here to stay. Increase in demand in emerging economies will likely continue to push prices upward before the world begins to produce enough to satisfy a global appetite for more.
 

It is sad to see that the central bank is not independent enough to be able to use monetary policy instruments at its disposal, even if it meant to go against the interest of the executive branch up at Arat Kilo, which understandably wants to continue maintaining one of the lowest interest rates in Africa, in a bid to boost growth.

The fact that a bill now in Parliament for amending the founding laws of the central bank proposes to make it answerable to the Prime Minister is depressing to those who would like to see the National Bank of Ethiopia (NBE) remain a credible independent institution, free from the meddling of the politicians. But this is a matter of ideological importance to a centre-left government, such as the one at the helm of Ethiopia's political power.

Nevertheless, neither is the governor competent enough to keep the nation's vault safe from swindlers who have succeeded in selling it stones and irons in the name of gold.

Whatever it is that policymakers try to do to bring down inflation, and stabilize prices, members of the public have to show a profound shift of attitude of life in general, and towards work in particular.
 

The working culture in Ethiopia lacks so much, to say the least. Many, particularly in major cities, seem to have a weird understanding of the job world: They would rather work at their convenience and not when their respective job requires them to do so.

Productivity - measured by quality, time and cost - has become an alien concept. A series of excuses are thought to be good enough to justify failures to accomplish tasks, and a round of blame game to avoid responsibilities is rather a norm. Demand from supervisors for quality work delivered on time is often taken as violation of labour rights, whereas employees' failures to live up to expectations is much accepted and tolerated.
 

Lack of labour discipline and poor productivity, in terms of both quality and volume, is costing the economy a great deal. Where there is widespread inefficiency, it is the end user that pays for it. It all adds up in the cost variable, and contributes to the galloping inflation.

Companies, whether they are public or private, do suffer from an unhealthy high turnover of staffs, many unable to keep employees for even a year. There appears to be dissatisfaction within the labour market that go beyond monetary rewards, thus resulting in a high degree of mobility.

The World Economic Forum identified poor work ethics in national labour force as one of the top five problematic factors in doing business in Ethiopia, according to surveys conducted in 2007. Interestingly, respondents to this survey did not consider inflation (ranked 13 out of 14 factors) as much a problem as labour rowdiness and poor productivity.

Neither is the relation between employers and labour rated favourably: Of the 128 countries included in the survey, Ethiopia was ranked 113, indicating how unproductive this relationship becomes.
 

No doubt this pushes many of the start-up companies either to perform below capacity or to shutdown within short periods of their opening. Close to 60pc of companies exit from the market within three years of their founding, due to labour related un-productivity, reveals a doctoral thesis by Mulu Gebreeyesus, from Goteborg University, School of Business, Economics and Law, which surveyed the investment behaviour of Ethiopian manufacturing firms using data from 1996 to 2003.
 

Even in rural Ethiopia, where 80pc of the population depends on subsistence farming, agriculture accounts only for 40pc of output, according to another study conducted in 2006. 

The net result cannot be pleasant news: Ethiopia as a nation remains to be one of the least competitive countries, even by African standard, if we go by Africa's Competitive Report produced by the World Economic Forum. In 2004, Ethiopia was ranked 19 out of the 25 economies in sub-Saharan Africa. The global ranking is more depressing: Ethiopia was among the 12 least competitive economies in the world.  
 

Yet, there appears to be a climate of acceptance as if this is Ethiopia's fate. Many seem to have resigned themselves to accepting their situation of deprivation, and are less motivated to change it through effort and hard work. If the going is getting tough, several are those who tend to rather manage their dreadful conditions (poverty) by becoming those willing to measure up to the volume and quality of their work.