Lagos, Aug. 17, 2023: Manufacturers and industrialists have called for coordinated effort from the government, the Central Bank of Nigeria (CBN), the private sector, and the civil society to tackle inflation.
They said this on Wednesday in Lagos while reacting to the country’s surging inflation figure majorly driven by higher prices of food items.
Mr Segun Ajayi-Kadir, the Director-General, Manufacturers Association of Nigeria (MAN), attributed the persistent inflationary pressure to the fallout of recent government policy including removal of fuel subsidy and the unification of exchange rate.
Ajayi-Kadir added that concerns about increasing energy costs and widespread insecurity in food-producing regions also exacerbated inflationary pressures.
He noted that the current inflationary condition in Nigeria was adversely affecting manufacturing operation, just like most other sectors of the economy.
Ajayi-Kadir listed some of its impacts to include increase in production cost, reduced profit margin, supply chain disruptions, uncertainty in planning, and reduced consumer spending.
He said a combination of the recommendations by stakeholders, tailored to Nigeria’s specific economic circumstances, could help mitigate inflationary pressures and promote sustained economic growth.
“Some of the ways that will ensure effective and conducive operations of manufacturers in the Nigerian economy include the CBN implementing effective exchange rate policies that prevent sharp depreciation of the currency.
“There should be increased targeted support to the agricultural sector to enhance productivity, reduce reliance on imports and stabilise food prices.
“Nigeria must continue to formulate policies that promote a stable and conducive business environment which can attract both local and foreign investments, leading to increased production, job creation, and ultimately, stability in prices.
“Government must commit to addressing the challenges of insecurity and should deploy fiscal reforms that prioritise productivity and intensify infrastructural development to stimulate economic activity, create jobs and improve living conditions,” he said.
Dr Chinyere Almona, the Director-General, Lagos Chamber of Commerce and Industry, expressed concerns about more inflationary pressures in the coming months due to the volatility of the Naira.
Almona charged government to step up efforts to tackle food costs, especially staple food items.
“We commend the Federal Government’s declaration of a state of emergency on food security and urge them to prioritise farmers’ areas of assistance, fertilisers, and seeds.
“This would mitigate the effects of subsidy removal as well as strengthen strategic food reserves to be used as price stabilisation mechanisms.
“The Chamber implores the government to hasten the provision of the anticipated palliatives to lessen the impact of the rising trend in prices on economic agents,” she said.
In July 2023, Nigeria experienced a surge in inflation, with the rate reaching a new 18-year high of 24.08 per cent.
This marks an increase of 1.29 per cent from the previous month’s rate of 22.79 per cent, as reported by the National Bureau of Statistics (NBS).
The increased food prices were attributed to planting season and logistic costs as impact of fuel subsidy removal took its full course.
Notably, the most substantial price increases were observed in gas, air passenger transport, liquid fuel, vehicle spare parts, and fuels, lubricants for personal transport equipment, medical services, and road passenger transport.
