The Lagos Chamber of Commerce & Industry, LCCI has called on the federal government to urgently step up efforts to tackle food costs, especially staple food items as a result of the soaring inflation in the country.
Nigeria’s headline inflation rate accelerated for the seventh consecutive month to 24.08 per cent in July 2023 from 21.82 per cent in January, according to the latest inflation figures released by the National Bureau of Statistics (NBS). The rate is the highest since September 2005. It increased by 1.29 percentage points when compared to the previous month, 22.79, and on a year-on-year basis, it went up by 4.44 percentage points compared to 19.64 recorded in July 2022. The significant rise in inflation largely reflects fuel subsidy removal and exchange rate devaluation. Food inflation increased by 1.73 percentage points to 26.98 per cent from 25.25 percent the previous month.
While commending the FG for declaring state of emergency on food security, the Director General of LCCI, Dr Chinyere Almona, yesterday, asked the government to prioritise farmers’ areas of assistance, fertilisers, and seeds to 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.
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She added that the Chamber is concerned that there may be more inflationary pressures in the coming months due to the volatility of the Naira as well as the lagged effects of subsidy removal and its transmission to general prices.
Meanwhile, Nigeria Employers Consultative Association, NECA, has called for more stringent action that will significantly reduce the influence of economic saboteurs in the foreign exchange value chain.
The DG of NECA, Adewale-Smatt Oyerinde, yesterday, noted that while the unification of exchange rate policy gained traction at the initial stage, it has now progressively become undesirable due to activities of saboteurs.
“The persistent wrong channeling and mis-management of forex on organised businesses has become agonising. Business working capital, production, capacity utilisation, investment, sales etc., have contracted significantly, while firms are forced to downsize. The grey trajectory portends tragedy for the economy, if not quickly addressed. Consequently, a more stringent action that will significantly reduce the influence of economic saboteurs in the FOREX value chain must be implemented. We believe that if the parallel market is not legal, then it is illegal and should be treated as such,” he noted.
He opined that the continuous existence of the parallel market, particularly in open places, would continue to encourage unruly banks in the country to round-trip, notwithstanding the implication on the economy.
“In order to reduce the pressure of FOREX and other economic challenges associated with it, we urge the government, as a matter of urgency, to ramp-up the production of crude oil to at least the 1.8 million barrel per day OPEC quota for the country; pursue and eliminate crude oil theft; resume domestic refining to save FOREX for other productive uses; and be fiscally disciplined in terms of dollar dealings. These measures, will no doubt, avail more forex to CBN for onward intervention in the official forex market, which will enable businesses to source forex to sustain business activities,” he added.