The fact that Nigerians at the local level are crying en masse over inflation in food prices is no gainsaying. However, the status quo may heighten to unbearable situations if swift actions are not taken. That the Government must jump into action is an understatement here. Speculations that Sub-sahara Africa risks acute famine over food shortages has been ringing since the COVID-19 pandemic traced its steps into the region. In its June CPI and inflation report released last Friday, the National Bureau of Statistics (NBS) disclosed that the consumer price index which measures inflation increased to 12.6 per cent (year-on-year) in June. According to the report, the increase is higher by 0.16 per cent comparatively to the rate recorded in May 2020 which was placed at 12.4 per cent. Increases were recorded in all Classification of Individual Consumption by Purpose divisions that yielded the headline index.
On month-on-month basis, the headline index increased by 1.21 per cent in June, which was a 0.04 per cent rate higher than the rate recorded in May 2020 which stood at 1.17 per cent. The percentage change in the average composite CPI for the 12-month period ending June 2020, over the average of the CPI for the previous 12-month period was 11.90 per cent, representing a 0.11 per cent point increase from 11.8 per cent recorded in May 2020. On a month-on-month basis, the urban index rose by 1.23 per cent in June 2020, up by 0.05 from 1.18 per cent recorded in May 2020, while the rural index also rose by 1.19 per cent in June 2020, up by 0.03 from the rate recorded in May 2020 (1.16) per cent. The corresponding 12-month year-on-year average percentage change for the urban index was 12.50 per cent in June 2020. This was higher than 12.4 per cent reported in May 2020, while the corresponding rural inflation rate in June 2020 was 11.4 per cent compared to 11.3 per cent recorded in May 2020. The urban inflation rate increased by 13.2 per cent (year- on- year) in June 2020 from 13 .03 per cent recorded in May 2020, while the rural inflation rate increased by 11.99 per cent in June 2020 from 11 ?.83 per cent in May 2020.
Moreover, according to the report, the composite food index rose by 15.18 per cent in June 2020 compared to 15.04 per cent in May 2020. The rise in the food index was occasioned by increases in prices of staples including: bread and cereals, potatoes, yam and other tubers, fruits, oils and fats, meat, fish and vegetables. On month-on-month basis, the food sub-index increased by 1.48 per cent in June 2020, up by 0.06 per cent points from 1.42 per cent recorded in May 2020. The average annual rate of change of the food sub-index for the 12-month period ending June 2020 over the previous 12-month average was 14.5 per cent, representing a 0.13 per cent points increase from the average annual rate of change recorded in May 2020 which stood at 14.3 per cent. More disturbing, the Naira on Tuesday exchanged at N472 to a dollar at the parallel market in Lagos, while the Pound Sterling and the Euro exchanged for N575 and N530 respectively. The Naira, however, traded at N388.17 to a dollar at the investor’s window.
All these are negative indications of imbalances in the country’s economy. While it is known that the Federal Government may be putting efforts in the place to cushion the debilitating impacts of strains in the economy, reinforced by COVID-19 and the sporadic fall in oil price, it is notwithstanding significant to state that galvanizing such efforts on grounded foundations of revitalising economic measures to pull the economy out of the shambles of policy disarray remains unequivocal. The adoption and application of wrong measures to strains in the economy can not be afforded at this time. All indices are showing that the country’s economy is at the verge of slipping deeper into recession. The inflation rate is increasingly rising to a point that may be unbearable for the poor masses in Nigeria.
Inflation on prices of food staples has been much worrying recently. Food of all basic human needs remain crucial and indispensable. The concern of the Government should much more be strategically swift for the masses at the local level, who may face unbearable hardship, should the accelerated inflation in food prices be left unaddressed. Attention and concerted efforts should be directed towards agriculture to cushion the effects of a projected scarcity. The need for Government intervention in the agricultural sector is much more pronounced with the demands of the present time, particularly on food production and supply. The planned Federal Government economic stimulus package should give agriculture a comprehensive priority. While the Government cannot afford other disturbances with the stocks of strains reinforced by the COVID-19 pandemic, it is important that the Government be proactive to manage a looming suffering, particularly on the part of low income earning Nigerians.
Economic hardship has been discovered in studies and experiences to be catalyst to various forms of ugly developments and adventures that may lead to anarchy which the Government will find difficult to curtail. To forestall such situation, the need for the Government to (among other measures) look into investing massively in agriculture promptly is alarming. While the Federal and State Governments should begin to look into mechanized system of agriculture in the long run, it is pertinent for the looming emergency, that much attention be given to expand the capacity of investment into this year’s (2020) planting season. Giving incentives to farmers to broaden large scale farming capacities is paramount, while necessities such as storage facilities, irrigation systems and transportation infrastructures, among other linkage apparatuses, should not be left out of the box.