Its funny how you spend half your working life wishing you earnt US dollars rather than the OZ dollar and now that you do, you would rather be paid the Pacific Peso (a now quaint historic term for the OZ dollar). One side-effect is that western goods sourced from OZ are getting a tad more expensive.
My new pack of 5 dozen Marathon dim sims now costs USD30, up from USD20 last time. Even the $2 Tiger beer is fast disappearing and it is only a matter of time before your typical OZ beer rockets from $2-50 to $3 over the bar. Mrs.Macs pies remain at around the $2-50 mark. For some reason, I don’t seem to notice the price of most other things except maybe breakfast cereal which has broken through my upper ceiling price.
It is worth noting that the general feel of Dili is significantly different when comparing early 2006 to now. I would think western supermarket turn-over has trebled so goods ought to be fresher and turn-over greater.
For the discerning snag, here is my analysis of price increases from MY sample basket of goods.
Price increase is from March 2006 to October 2007 (close enough to 18 months). During the same period, the US dollar fell by 21% against the aforementioned peso. My sample is based on one selected vendor and as we know, prices can vary significantly between vendors.
| Snag Item | Price Increase |
| Melbourne Bitter cans (OZ) | 21% |
| Heineken cans | 29% |
| Tiger beer (Sg.) | 17% |
| Bintang beer (Ind.) | 0% |
| Penfolds Rawsons Retreat wine (OZ) | 0% |
| Wolf Blass Red Label wine (OZ) | 0% |
| Penfolds Koonunga Hill wine (OZ) | 0% |
| Gordons Gin (part NZ) | 11% |
| Johnny Walker Red Label | 0% |
| Coca Cola (OZ) | 21% |
| Coca Cola (Ind.) | 20% |
| Soda water (Ind.) | 20% |
| Heinz Baked Beans | 10% |
The figures are revealing. Some of your 100% OZ produced goods seem to have increased exactly with the fall in the US dollar. Non-OZ goods do a bit better. However, no matter what prices I looked at, OZ wine has not changed at all. I guess this reflects the production situation in OZ more than anything else. Feel free to draw your own conclusions.
FOLLOW-UP :
Today, I bought a beer and a pair of thongs (ie flip flops or jandals) for US$2. Hardly bank breaking. If you go local (ie Asian/Indonesian) and are happy with the substitute goods, you can go a long way.
This is very interesting stuff. I’m going to TL in a month to actually conduct a study on USD and inflation in TL. Do you know of anyone in Dili asking these questions as well?
Cheers
Jim
Ministry of Finance. There are a group of OZ advisors in the Ministry assisting with budget planning, taxation etc. Someone does produce inflation figures and I would assume it comes out of the same Ministry.
There are the usual supply/demand issues but here the relatively fast change in OZ/US rates affects what expats tend to purchase. Asian/Indonesian pricing will tend to affect what the Timorese tend to purchase.
A lot of western goods come via ship from Darwin but Indonesian goods tend to come from Surabaya. Short-term shortages also seem to affect pricing. It amazes me just how sensitive goods supply can be to delays at the docks or in Customs and how so many locals tend to know about product X being stuck on the docks (eg like eggs at the moment).
I am also amazed at the huge price differential between similar goods. Bread is a good example. Imported frozen packaged bread from Darwin tends to cost a lot compared to locally made bread. Personally, the sweet Asian style of bread is not to my liking but having found a local supplier of excellent bread (in the form of buns), it is a no-brainer. But how long did it take to find out ?
For the expat, it can take a lot of effort to find acceptable local substitutes. This extends from building materials to food to clothing. Without a sophisticated marketing/advertising system, the cost of discovery can be high. But can even be higher if the cheaper local substitute fails to perform (ie breaks in 1 week etc.) Sometimes you win, sometimes you lose.