MINISTRY OF FINANCE

CENTRAL STATISTICAL OFFICE

My experience with the ZIMSTAT will be a period of exposure and acquaintance to

the job environment. My work related learning experience will be a reinforcement of
economic statistics well fused with macro economic concepts I learned in the first
part of my degree programme. I managed to settle down with much ease at the
ZIMSTAT and the knowledge I have so far gained is helping me in understanding the
practical applications of my degree programme. I hope that by the time I leave the
organization I will have knowledge about the statistical field and have attained
numerous skills which will be of use to me in the future.

SURNAME

NHUNDU

FORENAMES

COURAGE ZVIDZAYI

REG NUMBER

R0722297A

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PROGRAMME

HECON

TABLE OF CONTENTS

PAGES

1.

ORGANISATIONAL CULTURE/ STRUCTURE

(4)

2.

EXPECTATIONS

( 10 )

3.

NATURE OF INDUSTRY AND INDUSTRY DEVELOPMENTS

( 12 )

4.

COMPANY SOCIETY AND CONECTIONS

( 17 )

5.

PERSONAL DEVELOPMENT

( 18 )

6.

HANDLING CONFLICT BETWEEN PERSONAL AND

( 19 )

ORGANISATIONAL OBJECTIVES
7.

KEY SKILLS DEVELOPED AND WORK DONE

( 20 )

8.

RE-ENTRY

( 38)

9.

OVERVIEW

( 39 )

10. CONCLUSION

( 41 )

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Abstract
This report was compiled and completed as a partial fulfillment of the requirements of
the Bachelor of Commerce Honors Degree Economics with the Midlands State
University. Covered in this report is my work experience which I gained by being
attached to the Central Statistical Office National Headquarters in Harare. The report
figures out the roles of the CSO as the National Statistics Compiler, its background
and structure. The report highlights my major areas of responsibility at CSO, how my
attachment period developed and strengthened my field of study.
Acknowledgement
I would like to express my gratitude to the Central Statistical Office staff and
management for their support during my period of placement. Special thanks goes to
my supervisor Mr Damba, who was my source of inspiration during the whole course
of my work-related learning period, and the prices section staff which includes Mr
Safure, Mr Chikadaya, Ms Dzikiti, Ms Kafasiyanji, Ms Chirochierwa, Ms Tombori,
and all my fellow students also on attachment for their support which cannot go
unmentioned. I would also like to thank the Midlands State University, in particular
the Department of Economics for their well structured degree programme, which has
enabled me to have a chance to be exposed to the practical issues of my field of study

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and all my lecturers who made me fully equipped by giving me an arsenal of tools
necessary for me to be ready for the work-related learning.
I would also like to extend special regards to my family and above all, the Almighty
God for giving me the will and the power to prosper during the whole period of my
work-related learning

Chapter 1: Organisational Culture/ Structure

1.1.1Organisational History
The Central Statistical Office came into existence in 1894 when the British South
African Company (BSAC) first established a Record and Statistical Department
which was under the control of Hubert Harvey. Upon his death in the Matopos area,
the Civil Commissioner based in Harare (then Salisbury) took over his functions. The
Office conducted its first census in Bulawayo in 1895 for which the Mining and Civil
Commissioners supplied estimates of the mining and urban population respectively. In
1897 another census was conducted in Salisbury and information was collected
through the Office of the Acting Magistrate.
A variety of independent sections were set up by 1924 to engage in the collection of
statistics. A recommendation was made that greater efficiency would be achieved if
these duties were centralized in a department under a qualified statistician. A
monetary provision was made upon recommendations for the establishment of a
Statistical Bureau under the Ministry of Home Affairs. The Bureau was tasked with:

Carrying out any census

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Collecting, compiling and analyzing statistical information for the

commercial, industrial, agricultural, mining and social spheres of the
economy.

Collaborating with Government in the collection, compiling, co-coordinating,

analysis and publication of statistical records of administration.

In 1960 the Office was transformed into a department under the Ministry of Economic
Affairs and subsequently changed its name to the Central Statistical Office (C.S.O.).
In 1981 it was transferred to the Ministry of Finance and Economic Development
under which it operated until the splitting of the Ministry in April 2005. The
department was then transferred to the Ministry of Finance.
Following wider consultations in 1998 and 1999, it was recommended that the
Department be transformed into a semi-autonomous executive agency. Both the
Public Service Commission and then Ministry of Finance and Economic Development
embraced the idea and offered their support. In this regard a lot of work has been
undertaken by the stakeholders concerned and they have already adopted the name
ZIMSTATS (Zimbabwe Bureau of Statistics), the name CSO will thus be dropped.
The main aim is to free the Department from not only being a Government Statistician
but also for the private players and unlock its value as it is likely to improve capacity
utilization.
1.1.2

Statutory information

The Department is a public office as it is controlled by the Government of Zimbabwe

and its operations are governed by the provisions of the Census and Statistics Act
(Chapter 10:05) as amended by Act 22 of 2001 effect 22 September 2002. The Act
provides for the office of the Director of Census and Statistics appointed by the
Minister of Economic Development or any Minister the President may assign to
administer the Act from time to time. The Director is responsible for appointments of
other staff members and the day to day administration of the Department. He submits

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a report to the Minister after the 30th of June each year detailing the operations
undertaken in the preceding year.
It is a criminal offence under the Act to disclose information to outsiders without the
necessary authority from the Director. In some cases, the Director cannot without the
approval of the Minister, disclose any information to those outside the Department.
The provisions of the Act are mainly there to enforce high level of confidentiality and
privacy as statistical information is a valuable asset to the economy.

1.2.1

Organizational Culture

The culture of an organization is an amalgamation of the values and beliefs of the

people in an organization. It can be felt in the implicit rules and expectations of
behaviour in an organization where, even though the rules are not formally written
down employees know what is expected of them. It is usually set by management
whose decisions on policy usually set up the culture of the organization. The
organization culture has values and beliefs that support the organization goals. The
culture of the organization if it is positive and helpful can help to motivate the staff.
An organization culture needs to be managed in order to maintain a positive culture
and hence the need to have a clearly defined vision, mission statement, and the core
values.

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1.2.2

ORGANISATION CHART (C.S.O.)

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Director of census
& statistics
Deputy Director
Social and
Population
division T

Deputy Director
Economic
Statistics Division
Training

Assistant Director
Census and
Surveys Branch

Assistant Director
Social Statistics

Assistant Director
Production
Statistics

Assistant Director
Income Analysis

Household
Surveys

Health and Vital

Statistics

Agriculture
Statistics

National Accounts
Statistics

Population Census

Environmental
Statistics

Foreign Trade
Statistics

Financial Statistics

Computing

International
Migration and
Tourism

Production
Statistics

Prices Statistics

DTP and Printing

Employment and
Education

Informal Statistics

Judicial Social
Welfare Statistics

Social indicators
and Living
Conditions

Gender Statistics

1.2.3

Summary of Major Departments

There are two main Divisions each with two branches supported by several sections.
The two main divisions are:
a)

Economic Statistics Branch

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The branch is responsible for the compilation of statistical information that relates to
economic activities (activities of the secondary, primary and tertiary industries) going
around the country and is under the control of a Deputy Director who reports to the
Director. The division is further split into two branches namely Income Analysis and
Production Statistics. Each branch is headed by an Assistant Director who acts as an
interface between the sections statisticians and the Deputy Director responsible for
the whole division.
i.

Income analysis branch

This headed by the assistant director (currently Mr. N. Taruvinga) who reports to the
director. This branch is further divided into three sections namely:
Prices section,
Finance section,
National Accounts.
Each of the above sections is headed by statisticians.
ii.

Production Statistics

This is subdivided into sections headed by statisticians namely:

Agriculture
Foreign trade
Production
iii.

Training

b) Population and Social Statistics

The main task of this division is compiling and analysis of statistical information with
regards to the social welfare of the population and carrying out any field surveys and
mapping for the whole Department. The division is further split into Household
Surveys and Cartography and Demography and Social Statistics.
The Division compiles statistics used by various organisations to determine the social
welfare of the different communities around the country.
i.

Social Statistics

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This is responsible for gathering information relating to the social welfare of the
people in the country, for example level of employment, health and education. Four
sections fall within this section and are:
1. Health.
2. Environment
3. International migration and tourism
4. Employment and education
ii.

Census and Surveys Branch

This includes sections like:

Household surveys
Population census
Computing
Printing
These major departments are dependant on each other as the information from other
department may be useful to another department.

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Chapter 2: Expectations
Chapter 3: Nature of Industry and Industry Developments

3.1

Nature of Industry

The Central Statistical Office is the only body mandated by the Government to
publish official statistics. The status of the CSO is regulated by the Census and
Statistics Act, the organization forms part of the Public Service and falls under the
Ministry of Finance
3.1.1

Vision, Mission Statement and Core Values

Vision
To be the leading world class provider of national statistics in Zimbabwe.
Mission
To contribute to national development through the production and dissemination of
timely and accurate national statistics that facilitate:
Policy formulation
Planning and decision making
Evaluation and research
Transparency and good governance
This will be achieved through the use of automated technology with highly skilled
and motivated staff.
Core Values
In pursuit of our mission, we shall be respectful, courteous, open, transparent and

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responsive to both users and suppliers of data. We will ensure confidentiality of

information in producing a high quality statistical service with professionalism and
integrity.
3.1.2

The CSO strategy:

The strategy to achieve the mission is through the carrying out of the following
functions:
(i)

Drawing up an overall master plan for official statistics and keep it under
continuous review

(ii)

Establishing statistical methodologies and standards and ensuring their use

by
all producers of official statistics so as among other things to facilitate the
integration and comparison of the statistics produced both nationally and
internationally.
(iii)

Co-ordinating statistical activities in the country so as:

- To avoid duplication of efforts in the production of statistics
- To ensure optimal utilization of the available resources
- To reduce the burden, on respondents, of providing statistical data

(iv)

Collecting, compiling, analyzing and disseminating statistics and related

information

(v)

Maintaining an inventory of all available official statistics in the country and

assisting users in obtaining international statistics

(vi)

Providing Statistical Services and professional assistance to official bodies

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and the public at large

(vii)

Providing a contact point for international organizations and foreign

institutions in need of statistics on Zimbabwe.

3.1.3

Main roles of the CSO:

To provide statistics to the government, business community and general
public as well as international organizations for use in planning and decision
making

To co-ordinate statistical activities so as to produce statistics that are

consistent

The CSO is aware that both parties of the Zimbabwean economy are gearing up for an
economic recovery path, hence this inevitably generate increasing demand for more
better statistical information. Major decisions are being made concerning economic
and organizational change, and decision makers require accurate, timely and relevant
statistics. The demand from public and private users of data on economic status,
demographic information, etc. is increasing. The increasing importance of private
sector activities has made it imperative to strengthen the collection of statistics in this
sector of the economy.

3.1.4

Purpose of Statistics and Statistical Principles

The purpose of statistics is to assist organs of state, businesses, other organizations

and the public in:

Policy formulation;

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Decision-making or other actions;

Monitoring progress and evaluating performance.

* Decision making should be evidence-based and up-to-date statistics are required to

monitor progress in the implementation of various policies and programmes in the
country. High quality statistics are of benefit to the Government, Research
Institutions, Civil Society, the Private Sector or Development Agencies.
Statistics shall protect the confidentiality of the identity of, and the information
provided by, respondents and be

Relevant, accurate, reliable and timely;

Objective and comprehensive;

Compiled, reported and documented in a scientific and transparent

manner

Disseminated impartially;

Accessible;

In accordance with appropriate national and international standards

and classifications; and

Sensitive to distribution by sex, age, geographical breakdown and

similar socio-economic features

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3.2

Industry Developments

It has long been recognized that an effective statistical organization needs to be

managed strategically, making efficient use of the scarce resources to meet the needs
of its users.
Strategic planning encourages the country to prepare strategic plans for statistics and
careful decisions need to be made about how best to develop statistics most
effectively and efficiently. Hence the CSO is working on the transformation to a semiautonomous agency and the creation of a National Statistical System (NSS).
3.2.1

Reasons for the transformation of the CSO into a Semi-Autonomous

Agency
The current state of the National Statistical System is uncoordinated, where many
institutions produce the same data which at times are conflicting hence the
government took a decision to transform the CSO as a step to address some of these
problems at the same time enhancing professional independence.
The CSO is expected to coordinate the National Statistical System and provide the
lead in the development of statistical standards and methodologies to minimize
conflicting data and promote efficiency in the use of the scarce resources and this will
see CSO operating under the name Zimbabwe Bureau of Statistics (ZIMSTAT).
3.2.2

Benefits of transforming the CSO into a Semi- Autonomous Agency

To enhance the credibility and impartiality of official statistics

To remove the bureaucratic encumbrances and hence improve efficiency in

the provision of official statistics, and

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To stem the tide of high staff turnover which has eroded capacity for the
office to perform its function to the expectation of users

Chapter 4: Company-Society and Connection.

CSO cherishes the presence of the society which provides the backbone upon which
the organization can perform most effectively and efficiently in collecting, analyzing
and disseminating timely statistics for evidence-based planning and decision making.
Hence CSO has set up a National Statistical System which is composed of
Development Partners consisting of:

Users of data

Producers of data

Suppliers of data

Research and Educational institutions

From this set up it can be noted that CSO is maintaining a strong relationship with:
4.1

The general public

CSO sells its publications and reports at very low prices, for example the CPI which
costs $3. Also information on poverty datum lines and inflation figures can be given
for free upon request.
4.2

The research and educational sector

Quality abundant data is available for research purposes and the CSO also conducts
user funded surveys on behalf of interested research institutions/ organizations. CSO
is doing a very commendable job by providing attachment places for university
students. To date CSO has offered relevant working experience to a number of

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students from MSU, NUST and other universities to consolidate well their theory
acquired at the university.
4.3

The business sector

CSO provides useful information for the business sector to plan for future business
expansion and products, by area, using wages as an assessment for affordability. CSO
also provides useful economic indicators like Consumer Price Index (CPI) which
measures inflation. CSO data also help market products, monitor progress and
developments in the industry and also monitor the performance of the other
competitors.
Chapter 5: Personal Development
Since joining the CSO I have developed personally both as an employee and as a
student. I have managed to distinguish myself as a loyal and independent employee,
who can work under minimum supervision and produce results even when working
under pressure.
Self-confidence
Knowledge is empowerment. I was hesitant of myself when dealing with clients and
communicating with management during my initial days due to lack of technical
experience and the fear that I would not be able to deliver as expected. After acquiring
the basic skills I became very confident and was able to convince my superiors that I
was capable of doing my work exceptionally well and also giving first line support to
clients. With confidence my superiors were able to trust me throughout the course of
my work-related learning period. I had confidence when attending to clients and
would also kindly refer them to the head of the section, who would best handle their
requests.
Strengths
-

I am always smartly and professionally dressed

I always show positive attitude and readiness to guide others

I do not carry family tensions and worries along with me to work

I can work under pressure and still produce the desired objectives

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I can also work independently with very minimum supervision

I am a good listener

I have a good spirit for teamwork

Weaknesses
No one is hundred percent perfect but what it needs is for one to understand and
appreciate that we all have weaknesses and one should know exactly what their
weaknesses are so that one can churn them out into strengths.

Chapter 6: Handling Conflict between Personal/

Organizational Objectives
There was never really a time when educational objectives conflicted with
organizational objectives since the CSO has become a home for most economics
students on work related learning. The CSO has created an effective learning
environment to train students by exposing them to the challenging yet attainable
practical issues in the field of statistics. The CSO has a fully equipped library as far as
statistical and other reading material is concerned, and I utilized this library during my
free time and it was also allowed to borrow books if one wants to read over night.
Conflict normally arises when there is a natural disagreement resulting from a
difference in attitudes, beliefs, values and needs and it can also originate from past
rivalries. Having a personal conflict with other staff members would surely result in
organizational objectives being undermined. Hence to make sure that no conflict
existed between my personal and organizational objectives, what I did was to make
sure that no conflict existed between me and any other CSO staff, as this would also
affect organizational objectives.

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I would like to point out that during the whole period of my placement I never
indulged myself into any kind of personal rivalry with my workmates, my superiors or
any other CSO staff. There was never a time I failed to honour my duties as a result of
a conflict with another individual.

Chapter 7: Key Skills Developed and Work Done

7.1

Skills developed

Here are some of the key skills I have developed during my period of placement, in
and out of the office: 7.1.1

Time conscious

Time management is very vital in order to fit well in an organization. Some work was
supposed to be done within time frames; deadlines had to be met, reports wanted at
specific times for example, monthly reports. This required me to manage my time
wisely in order to accomplish these deadlines. Failure to adhere to time to do certain
tasks or procedures severely affected desired objectives. This meant I had to prioritize
tasks and be punctual in coming to work in order to manage my time wisely. The
guidance from senior staff members in our section on how best to manage time was
again helpful. It was very difficult at first but I managed to adapt well as time
progressed
7.1.2

A good communication skill

I have developed essential communication skills through words, actions, body

language, and voice tone, I have managed to respond well when attending to a client

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both face to face and over the phone, or when talking to a superior or when in a
meeting.
7.1.3

A good judgemental skill

I have developed a good skill of first considering the advantages and the
disadvantages before making decisions, weighing risks involved and anticipate the
short term and long term effects. This is achieved by going into the depth of every
situation at hand rather than to just assume things.
7.1.4

Planning and Organizing

I learnt that proper analysis and planning of how best to solve problems usually
shortened the possible resolution time and effectively utilizes resources. I am now
able to plan and organize resources for specific tasks and prioritize the tasks according
to stipulated deadlines and urgency among other things, and then make sure that all
deadlines are met.
7.1.5

Ability to use advanced statistical packages

I have developed effective computer skills in using advanced statistical packages like
the Statistical Analysis System (SAS) and the Census and Survey Processing System
(CSPro). I can now use a statistical system by defining the data fields (assigning
codes), data type etc. and then code the supplied data on the questionnaires.
7.1.6

Co-operation

I am always willing to work with others in achieving individual and team objectives. I
gained this skill since in our section we always worked as a family and in prices
section there is no one-man job.
7.2

Work Done

On entering the prices statistics section I was informed that one needs to be computer
literate, be able to work under minimum supervision, be time conscious and also be
accurate when dealing with figures so as to produce quality, accurate and timely
statistics. So I executed my work related learning in the Prices Statistics Section and
had two statisticians namely Mr A Damba and Mr Chikadaya and there was a

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Statistical Officer, Ms F Kafasiyanji and four Statistical Clerks (I mainly performed

the duties of a Statistical Clerk in the prices section.
7.2.1 PRICES SECTION
7.2.1.1

Key result areas:

Collection, compilation, analysis, interpretation and dissemination of prices
statistics.

Maintenance of prices database

Production of reports

The section is responsible for calculation of price indices and running the
International Comparison Program on behalf of the Zimbabwe Government. The
major publications are as below:

Consumer Price Index (CPI)

Civil Engineering Price Index (CEPI)

Buildings material index (BMI) and

Poverty Datum Line (PDL)

In principle, the indices are positively correlated as they all measure the rise in costs
for different sectors.
7.2.1.2 The International Comparison Program (ICP)
The ICP is an international program being carried out in 150 countries at the present
moment in all the continents. However, not all countries are participating in the
exercise. It is being administered by the United Nations and World Bank through
various continental bodies for easy of coordination. The two bodies are also

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responsible for funding the project as some of the countries do not have the capacity
to bankroll it on their own. In Africa, it is being coordinated by the African
Development Bank (ADB) and countries have been grouped according to the official
languages used so as to allow easy exchange of notes.
The program came into being as a result of the difficulties inherent in inter-country
comparisons using the traditional Gross Domestic Product (GDP) Approach. The
main aim is to come up with an average price from the basket of the goods and
services which was constructed after wider consultations with country representatives.
The basket is similar across countries in one region and has strict product
specifications to be followed. The pilot project was undertaken in the period 1990 to
1991 but in some selected countries across the continents.
Products in the basket list are tracked every month from selected outlets in all the
countrys ten provinces. Data collection is done using specialized questionnaires
which show all the products attributes needed. After price collection, the files are sent
to the Head Office for capturing and entry is done on a Protected Microsoft
Worksheet. During data entry, errors are prone to occur. Validation takes place
thereafter to perfect the records before submission to the ADB. All the files from all
provinces are merged using Merge Macro V which creates a country data file. This
contains all the captured records for the whole country. The next stage is to run
macros on the country data file using Semper Validation Software 1.0 and the results
are deposited in a validation book. The Semper was specifically designed for ICP data
validation. It recalculates price average for each item entered for the recommended
quantity. The validation book is used to track errors to their original provincial files
from where corrections are made. All products with the same code are grouped
together. Typical outliers are indicated and these have to be verified. In the event that
a wrong unit of measurement was used, the product code will be highlighted in red to

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draw the attention of the data verifier. The process of merging and running the Semper
continues until the records show consistency.
When satisfied that the errors have been eliminated, the country data file is sent to the
ADB Statistics Division where Quaranta tables are produced to calculate the price
averages and subsequently the Purchasing Power Parity. The ADB Statistics division
also produces a time series to find out if product prices are consistent over the period.
Price movements have to be in congruent with obtaining macro economic conditions.
7.2.1.3 Objectives of ICP

To calculate the Purchasing Power Parity of the currency combinations in the

basket and this shall be used for conversion of GDP figures to one currency
for comparison sake which is normally the US Dollar(US $). Currently there
are difficulties in coming up with an exchange rate for two currencies that are
not heavily traded. In some cases Government interference in the foreign
markets also tends to distort exchange rates which carry forward to GDP
conversion. There are some deliberate policies in some countries to ignore the
Relative Purchasing Power Parity which states that exchange rates have to
adjust to changes in consumer price indices between countries. The ICP takes
into account inflation movements as the same products in its basket are the
ones used for calculation of the CPI and inflation.

The information produced will be used to calculate and update poverty datum
lines in each region. The exercise is being used to identify needy areas where
donor funds should be apportioned. The Poverty Datum Lines for each country
will be converted into the US dollar using the purchasing power parity of the
ICP results.

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To assist in decomposing the GDP and its sub-aggregates as use of multiple

currencies does not assist in making inter-country comparisons. In this regard
the GDP figures of the participating countries are converted to one currency
using the recalculated PPPs. It

becomes easier to directly compare the

standards of living across countries under the different sub-groups namely

food, beverages, tobacco and narcotics, recreation and entertainment services,
health products, furniture and operations, clothing and footwear and transport
and communication.
However its major weakness is that it does not include expenditure on education and
acquisition of assets by industries (Gross Capital Formation) which are vital
components in any country. It is then difficult to compare the results at national level.
It is only comparable at household level. It is interesting to note that the United
Nations and the regional coordinators have noticed this and modalities are underway
to include such. Consultants have been hired to help participating countries integrate
such elements.
7.2.2 The Consumer Price Index (CPI)
The Consumer Price Index is considered the most widely measure of inflation which
is the rate at which the purchasing power of consumers is changing. It is thus regarded
as an effective indicator of fiscal and monetary policies pursued.
The computation of CPI begins with the Consumer Price Survey (CPS).CPS is a
national sample survey, which is designed to provide an estimate food and all items
inflation. The recording is done by trained enumerators under the leadership of their
team leaders who generally give directions as to what should be done. Prices are
recorded on a special questionnaire designed for each product and outlet which
specifies the product and outlet types but gives the enumerator the leeway to choose

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the brand and quantity. The product is referred to by a code so is the outlet and
locality from which the data collection took place. Usually the survey is done in the
week falling mid-month and this explains why some price changes may not be
captured and this impacts on the overall inflation figures for the particular month.
7.2.2.1 Sampling design for Consumer Price Survey (CPS)
A two-stage sample design was used for the CPS. The ward was the first stage
sampling unit in each province followed by the outlet/shop. All wards in each
province were listed using the 1992 census map and within each ward a list of all
outlets were listed then a random sample done within each sampling frame. A total of
120 clusters outlets are used up to the present day.
The CPI consists of a basket of goods tracked from month to month and currently has
428 goods and services which are mainly bought by consumers for final consumption.
The result of the calculations is an average at which the rate of goods and services
will be going up. The collection points are widely distributed (in both the rural and
urban areas) over the country to even out price fluctuations in provinces.
The current basket was adopted in June 2005 as a response to changes in
consumption patterns using weights constructed from the 2001 Income, Consumption
and Expenditure Survey (ICES).
7.2.2.2 Limitations of CPI
The main disadvantage of the Consumer Price Index (CPI) is that it assumes no
change in consumption patterns as the level of income changes in the short to medium
term. The assumption is that consumers will continue to buy the product at the
inflated prices but this only holds in stable economies and not hyperinflationary
environments like the one that prevailed in Zimbabwe before the introduction multicurrency system.

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It does not recognize the existence of substitutes out of the product class which
consumers can easily switch to. It may also take a long time for a new product to be
captured in the CPI despite it having an impact on the consumers spending patterns.
The Zimbabwe CPI is calculated using the modified Laspeyeres formula which allows
for weights to be assigned and changed to each product as the base year changes. It is
dynamic rather than static when it comes to alteration of weights. The method also
drops the weights of products which would have not been recorded in the particular
month so that the overall index is not affected. The products have been put into two
major subgroups namely food and non-alcoholic beverages and non-food items. The
weights are 31.93 % and 68.07 % respectively. To get the contribution of each group
towards overall inflation, the particular group inflation rate is multiplied by its weight.
The heavier the weight, the more the impact on the overall rate and vice versa.
After the collection process, the supervisor has to verify that what has been recorded
makes sense and thereafter, the files are sent to the Headquarters in Harare where
capturing takes place. Each province has its own database meaning data entry is on a
province by province basis. Records from different provinces do not appear in the
same file to allow for easy of reference should a query arise in the future.
Data entry is done using CSPro 3.0 and the system is secure as it always prompts the
user for identification to gain access and make corrections. This ensures that nobody
can alter the records in the database without authority. Each provinces database has a
statistical clerk who has the overall responsibility over it.
CSPro is a statistical package that can be used to process data from censuses and
surveys, both small and large. Typical subject areas include:

Housing and Population

Demographic Characteristics

Health and Nutrition

Agriculture

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Labor Force

Business Establishments

Education

Living Standards

Energy

Immigration

Household Income and Expenditure

CSPro includes the following modules:

Data Entry Applications

Batch Edit Applications

Cross Tabulation Applications

Tools

Data is then entered for the second time to minimize human errors and then done
manually before sending the data to the programmer for analysis.
After the data entry process, the records are sent to a programmer in a single folder
who is responsible for running in ASCII file.
The data is then converted to a Statistical Analysis System (SAS) program for
analysis.
7.2.2.3 Composition of the index
Index basket
The index basket comprises the indicator commodities and services whose price
change is believed to represent all possible goods and services that cannot be
practically included in the basket. The classification of these is based on the United
Nations System of National Accounts. It is basically called the Classification of
Individual Consumption by Purpose (COICOP)

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The smallest unit in the basket is an ITEM (either a commodity or service)

e.g. white bread is an item.

Related items are grouped together into sections which is a collection of items
that are related like fruits and vegetables. These are called groups. For
example if we combine white and brown bread from the above diagram we get
sub-group bread ( code 10110).

Sections/groups like fruits and vegetables, bread and cereals, meat, milk,
cheese and eggs, coffee and tea, fish, oils and fats, condiments and
confectionary, and other foods are rolled over to form an even larger collection
of related items called major group for example FOOD, HEALTH and
TRANSPORT.

The wider collections of items in major groups, for example food, health,
transport, clothing and footwear and alcoholic beverages are rolled over to
obtain the ALL ITERMS.

7.2.3

Calculation of month on month (m-o-m), year on year (y-o-y) and

annualized inflation rate from the CPI.

7.2.3.1 The Quick /Ratio Method

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The QUICK/ RATIO METHOD given by the below formulae is the one which is used
in the calculations of the month on month and year on year inflation rates from the
CPI
Ratio = (

CurrentVal ue
) *100-100
BaseValue

e.g. To calculate year on year annual inflation rate given that the value for all items
for February 2010 was 93.9 and for February 2009 was 94.6 then:

% change= (

93.9
)*100-100= -0.7
94.6

7.2.3.2 The Laspeyres Formula in index computation

The standard Laspeyres Formula compares the current cost of the base period market
basket (the numerator) with the base period cost of the base period market basket (the
denominator)

The Laspeyres Price Index is given by:

4

=(
t

p q
i 1
4

it

i0

p q
i 1

i0

)*100

i0

Where i=1, 2, 3, 4 representing the item at period t=0, 1, 2, 3

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The use of Expenditure Weights and Price Relatives in the Laspeyres Price Index
formula

=
t

p
w w0 p
1

)*100

Where pq=w=expenditure weights

7.2.3.3

Advantages of using the Base Weighted Laspeyres Formula for CPI

compilation

It is easier to interpret compared to superlative ideal indices such as the Fisher

or Tornqvist because the impact of the prices and that of quantities can be
isolated without great difficulty;

CPI users are usually familiar

with the Laspeyres Index as a standard

measurement of prices trend;

It allows for the taking into account the changes in the product mix and regular
updating of the selection of outlets;

The structure and weights of the CPI basket, which are costly and time
consuming to develop, remain constant for several years

7.2.3.4 Shortcomings of the standard Laspeyres Formula

Does not provide flexibility required for the current situation in economies
going through significant and rapid changes;

Overtime, large variations in price relatives are likely to develop and no

meaningful checks can be built in at the editing stage.

7.2.3.5 Modified Laspeyres Index

The basic formula is given as:

I w p
=
t

7.2.3.6

t 1

t 1

Why use the modified Laspeyres Formula

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It allows for the taking into account the changes in the product mix and regular
updating of the selection of outlets;

Does provide flexibility required for the current situation in economies going
through significant and rapid changes

7.2.3.7

Example: Index computation

Index=

Product

p
p
1

Weight (

p
*w
p
1

)
0

Bread

1500

2400

1.60

4.04

6.47

Sugar

1000

1350

1.35

5.20

7.02

Alcoholic Beverages 600

Transport
and

800

1.33

6.47

8.62

Communication
5000
Liquid and Gas fuels 2000
Purchase of motor

6500
2500

1.30
1.25

13.86
12.70

18.01
15.88

vehicles

3500

0.18

57.74

10.10

20000

All Items Index

66.10

To guard against errors from affecting the whole process, a price list for each province
is printed. It shows the product code, outlet code, current index, and the percentage
price change from the previous month. The percentage price change is usually used to
check for errors.
Statistical clerks go through editing noting down suspect price changes and verifying
using the official file. If the mistake is thought to have emanated from the recording
exercise, the enumerator and supervisor concerned are conducted to verify with the
outlet from which the price was recorded. This is meant to minimize the amount of
errors that could lead to distortions in the final figures.

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In the event that errors are detected, corrections are done in the original file.
Thereafter the files are sent back to the programmer who conducts a second run. The
clerks will then conduct a final error checking in case some errors might have escaped
unnoticed in the first stage and if no errors are detected, the indices are copied to an
Excel file from where the major calculations will take place. Formulae are assigned in
the sheet to calculate the inflation rates for the different subgroups and the all items
index on a monthly and annual basis. The advantage of using the Excel worksheet is
that it is user friendly and also it has been able to create a database of indices and
inflation rates for a longer period.
7.2.4 Time series analysis
Time series follows after the Consumer Price Index. This involves the trend
analysis which would then be used for forecasting/predicting future inflation
figures which is then an important tool in decision analysis. for example if we are
to analyse the movement of inflation figures from 2000-2006 we can see that from
the second quarter of 2005-2006 there was a sharp rise in the inflation figure and
by so doing this will help various sectors of the economy to make more informed
decisions so as to take necessary measures to deal with this.
Microsoft Excel is used to construct the graphs in order to make comparisons.
7.2.4.1 Uses of CPI Time Series
Time series can be used by various business stakeholders in making more
informed decisions in:

Determining average workers incomes in successive months,

Predicting company profits in successive years,

Predicting total export sales in successive months or years,

Analysing the sales figures in successive months through forecasting.

Example
The following graph which shows annual inflation figures that can be used in
forecasting by business stakeholders in coming out with some more informed
decisions

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Graphical illustration of Average annual inflation (2000 2006)

Time series can also be used to see the trend of the poverty for example the graph
below shows the poverty behaviour from 1986-2001.
From the graph we can see that between 1991- 1993 and 1998-2001 most people
were living under poverty datum line hence we can deduce that many people were
lowly paid or they were poor.
In 1995-1998 high living standards were achieved to most people.

7.2.4.2 Poverty Behaviour (1986-2001)

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7.2.5 Poverty Analysis

Poverty datum line (PDL) represents the cost of a given standard of living that
must be attained if a person is deemed not to be poor.
The food poverty datum line (FPL) represents the minimum consumption
expenditure necessary to ensure that each household can (if all expenditures were
devoted to food) consume a minimum food basket representing 2100 kilo calories.
The following basket which contains 17 items is the one used to determine Food
Poverty Line (FDL)
The quantity used is as in the CPI.
Bread
Maize
Rice
Ration Meat
Chicken
Flour

Fish
Milk
Eggs
Cooking
Cabbage
Rape

Tomatoes
Potatoes
Beans
Sugar
Salt

7.2.6 Deriving weights from expenditure data

The weights are mainly derived from the results of the ICES which usually becomes
the base year period. The weights which are currently being used were obtained from

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the 2001 survey, however the use of 2001 as base year was abandoned since the
introduction of the multi-currency system hence December 2008was adopted as the
base period. Calculation of weights take into account total quantity consumed and
total expenditure on the products. However, due to unavailability of quantities
consumed, the total expenditure on each product is used.
Example
Pr oduct

Expenditure on product
*100%
Total exp enditure

weight

Weight
Expenditure
Product
Bread

(US$)

(%)

product exp enditure

* 100%
total exp enditure

5.128

2.50

12.820

10.256

Maize meal 10kg

6.50

33.333

Rice long grain

10.256

Ration meat - beef

5.50

28.205

Sugar
Flour self raising

Total
19.5
100.000
7.2.7 Relationship between CPI and Purchasing Power
There is a negative relationship between the CPI and the purchasing power and a
positive relationship between CPI and the cost of living. When the CPI the CPI is
going up, so does the cost of living and the purchasing power of the currency will be
falling such that in times of stability or low inflation rate increases, the purchasing
power falls slowly while in times of deflation the purchasing power rises.

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7.2.8

Uses of the CPI and inflation rates

a. It is a measure of inflation as it affects households and thus provides a benchmark

on what investors should expect on their portfolios. The aim is to allocate funds to
those assets that beat inflation so as preserve ones wealth.
b. The CPI is used as an adjustment factor for indexation of prices, wages and
salaries and valuation of assets. In most cases assets have to be adjusted in line
with the inflation trends so as to at least maintain the purchasing power. In
accounting, financial statements have to be adjusted in accordance with inflation.
In accordance with the provisions of the IAS 29, accounts in hyperinflationary
environments have to be adjusted for inflation, as such environment which
prevailed in Zimbabwe before the use of multi-currency system.
c. The CPI is also used as a deflator of series in nominal terms to derive values in
real terms. In this regard, it is mainly used for deflating GDP figures to come with
constant prices compared to one base year.
d. It is also an important instrument for formulation of monetary and fiscal policies.
Monetary authorities set interest rates and exchange rates by use of inflation
figures derived from the CPI. In principle, the exchange rate between two
currencies should be equal to the inflation differential over the period. Fiscal
authorities use it to determine tax brackets.
e. CPI is also used in forecasting i.e. in predicting future events such as estimating
the coming month inflation rate.
f. It is also used to measure the poverty datum line as the prices used ,the quantity
and the outlets used are the same as those from CPI

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7.2.9

Workshops/ Seminars and Meetings attended

7.2.10 Commemoration of the Africa Statistics Day

Every year 18 November, Africa commemorates the AFRICAN STATISTICS DAY,
and CSO as the main producers of statistics in Zimbabwe, cannot be left out in
celebrating this day, and so 29 November 2009 was set to host what was going to be a
spectacular event in celebrating the African Statistics Day

Vital Statistics and

National Registration. The event started at around 8am with a marching process
from CSO Head Office, at Kaguvi Building, to Harare Gardens which was the venue
for the event. School children from several schools were invited to perform on this
day on the importance of national registration and the key note address was presented
by Mr Nyoni the director of CSO. The event finished around 1300 hours and lunch
was provided to everyone involved in the event.
7.2.9.1 Dissemination Workshop for the ICES Questionnaire
This workshop was held at the Holiday Inn Hotel. I was privileged to attend this
workshop whereby different stakeholders were invited to be briefed up on how the
ICES questionnaire is structured.

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Chapter 8: Re - Entry
The work related learning period is a very essential requirement for all undergraduate
students fulfilling an honours degree programme at the Midlands State University, as
such the third year is reserved for this period. After spending two years at university, I
acquired enough theory and now after completing my work-related learning, I now
have a clear insight of what awaits me in real life in my field of study.
I now know that nothing solidifies learning like experience, the work related learning
period made me understand the world of industry and commerce a lot better and I will
be going back to school for my final year with a different perspective about my life
since this period made me achieve a good sense of direction and I have also gained
key skills to help me tackle real life problems.
The attachment period made me realize the areas I need to improve academically and
the importance of the modules from other departments that we take, for example, the
Introduction to Computers module which really made life easier for me during the
attachment period. Computer literacy was relevant to perform tasks which are done in
the Prices Section and hence I now appreciate its relevance to my field of study.
Having attained a lot in terms of exposure during my period of placement at CSO
especially with what is done in the prices section, im looking forward to sharing what
I gained with my colleagues in the department of Economics.

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Chapter 9: Overview
I really appreciated the structure of the Economics degree at the
Midlands State University, all the theoretical aspects I learnt were critical and l
managed to apply them during the whole period of my placement as noted below:
. I really appreciated the module EC 100 (Statistics B) as it provided me with most of
the formulas that I used in the prices section that is, the laspayers and the quick ratio
which we used in the calculations of the CPI.
. With what I learnt in module EC 102( Statistics A), I quickly got to understand how
they used the sampling techniques in coming up with the selected outlets which are
then used to obtain data on price changes which are used in the computation of the
CPI.
. With the practical skills I had attained in a Computer Science module
Introduction to Computers, made me quickly appreciate all the different
statistical packages and data entry systems we use, such as the CSPro for compiling
and interpreting data.
9.2

RECOMMENDATIONS

It has been an enlightening period in which I got to understand the operations of

statistics, the behavior and relationship of various and statistical variables. There is
however some areas which I feel need to be improved.
9.2.1 Recommendations to the organization

In line with the economic environment in our economy as of date, i feel

that CSO as an organization should address the welfare of its employees.
In line with the mission statement that the department shall use highly

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automated technology and have a motivated staff, there is need to invest in

its staff welfare.
During the period l have been here l realized that the salaries of the majority
of staff are well below the Poverty Datum Line (PDL) of $452 for a family of
5 yet they earn around $150 per month. The greatest investment that an
organization can have is its staff as such it is imperative for the organization to
address the problem so as to hedge against brain drain, goodwill and public
confidence.

Despite having a well connected and secure Local Area Network (LAN) at
the head office, the same cannot be said of the provincial offices. They lag
behind in technology which at times posses a threat to maintenance of
confidentiality. They rely on time consuming manual systems. The
resources should be made available to procure palmtops for use in data
collection such as is done in South Africa. It allows data to be sent on real
time basis from the point of collection to the head office and queries can
thus be resolved urgently.

9.2.3

Recommendations to the Department of Economics

The Department of Economics should try to sensitize its undergraduates to be exposed

to the practical feel of the degree not only through attachments but also workshops
and field trips.
Secondly the department should establish its own computer laboratory so as to equip
its students with the know-how of using statistical packages in preparatory of the of
statistics since almost everything is now computerized in that field.
9.2.4

Recommendations To The University

The Library
It is my understanding that CSO produces so many publications which are very much
essential to students to build their theoretical foundations into practical frameworks
which is essential to trade and commerce. To this end l would recommend the

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Librarian to source this material at the CSO. For example the CPI and PDL
publications are produced monthly and cost only US$3.
Chapter 10: Conclusions
I really thank MSU for their well structured degree programme which has equipped
me with the necessary theoretical aspects which I have applied in the industry during
my period of placement and would also like to give credit to the Central Statistical
Office (CSO) which has equipped me with the necessary experience during my period
of placement.

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