By Chukwuma Umeorah
In addition to monetary policy interventions by the Central Bank of Nigeria, the Director-General of the Nigeria Employers’ Consultative Association (NECA), Adewale-Smatt Oyerinde, has called for the introduction of supplementary measures from the fiscal authority to address rising inflation.
Oyerinde noted that, while the tightening measures of the CBN were yielding positive results, leading to the recent appreciation of the naira, there is a decelerating increase in the recent inflation figure.
According to him, “Despite currency appreciation typically dampening inflation by reducing import costs, other factors are exerting stronger upward pressure on prices. Supply chain disruptions, logistical challenges, and rising production costs continue to drive up prices across various sectors, amplifying inflationary expectations.
However, there is hope that once the Dangote refinery commences production and distribution of petroleum products, transportation costs and other production expenses will significantly reduce.”
Oyerinde advises policymakers to adopt a holistic approach to address inflationary pressures and promote economic stability.
This includes implementing prudent monetary and fiscal policies to address supply-side constraints, enhance productivity, and stimulate investment in critical sectors such as agriculture and infrastructure.
Others include, fostering a conducive business environment, encouraging innovation, and promoting competition to mitigate inflationary pressures in the long term.
The NECA boss said the latest publication of the Consumer Price Index by the National Bureau of Statistics (NBS) for March 2024 reveals a significant increase in the inflation rate. “In March 2024, the inflation rate surged to 33.01 percent, marking an upward from 31.7 percent recorded in February. This indicates a 1.31 percentage point increase over the period, reflecting the growing inflationary pressures in the economy,” he stated.
Oyerinde said when compared to March 2023, the inflation rate rose by 10.97 per cent, further underscoring the magnitude of the inflationary challenge.
He harped that of particular concern is the spike in food inflation, which climbed to 40 per cent in March 2024 from 37.72 percent in February accounting for 17.2 percent of the total inflation rate for the month.
He emphasized the importance of monitoring inflation dynamics closely, assessing the impact of currency movements, and advocating for evidence-based policies to promote economic resilience and inclusive growth.
This is even as he urged government intervention at all levels.