Nigeria‘s inflation will continue to go up until the government decides to proactively address the security situation in the country.
From North West to North East down to North Central, South East and South West their lands have been invaded by bandits and Fulani herdsmen and this has posed a serious challenge to farming.
Because of this, analysts have said that the current 19 percent rise recorded in July 2022, may just be a child’s play when compared to what may likely happen from December 2022 upwards. They said the current inflation rate is the result of the various level of insecurity in the country whereby a farmer could not go to farm because of protected Fulani herdsmen that have turned into Kidnappers.
Asides from the fact that inflation may have also been induced by the prices of petroleum products which are imported, traders of commodities can also not travel on the country’s road because of kidnappers. A bunch of able-bodied men and women that would have been engaged in agriculture are at their homes wasting away because they could be attacked by these foreigners called Fulani herdsmen
Analysing the economic situation in the country, Idowu, Akintade, an economist said, the situation may be worse next year because more people could not go to farms this year and commodity traders could also not move around.
He said, you can imagine that a tuber of yam is still costing N3, 000 in August, when new yams should have been all over the place?. A 23-litre jerrican of palm oil that was N18,000 about a year ago in places like Kogi State is now sold for N24,000 with an additional N2,000 as payment for the jerrican. A paint of yellow Gari that was between N300-N700 last year, is now N1,100. Tomatoes are also costly now. All because farmers could not reach their farms on account of insecurity.
The inflation rate in Nigeria climbed to a near 17-year high in July, fueled by bread, cereal, gas, and transport costs, the National Bure NBS released the consumer price index (CPI), which measures the rate of change in prices of goods and services, showed a surge to 19.64 percent in July 2022, from 18.60 percent in the previous month. The rate is the highest recorded since September 2005.
The figure is also 2.27 percent points higher compared to the rate recorded in July 2021, which was 17.38 percent.
The report indicated that headline inflation rate increased in July 2022 compared to the same month in the previous year (July 2022).
Cost pressures are being fanned by a high import bill caused by surging commodity prices, supply shortages and a slide in the naira which caused the Senate to summon Central Bank of Nigeria (CBN) governor Godwin Emefiele.
The report disclosed that food inflation rose to 22.02 percent in July, an uptick compared to 20.60 percent in June.
This rise in the food index was caused by increases in prices of bread and cereals, food products, potatoes, yam and other tubers, meat, fish, oil, and fat.
“On a month-on-month basis, the food inflation rate in July was 2.04%, this was a 0.01% insignificant decline compared to the rate recorded in June 2022 (2.05%),” the report adds.
“This decline is attributed to a reduction in the prices of some food items like tubers, maize, garri, and vegetables.”
A major increase was recorded in all classifications of individual consumption according to purpose (COICOP) divisions that yielded the headline index, the report showed “on a month-on-month basis, the Headline inflation rate in July 2022 was 1.817 %, which was 0.001% higher than the rate recorded in June 2022 (1.816 %).
“The percentage change in the average CPI for the twelve months period ending July 2022 over the average of the CPI for the previous twelve months period was 16.75%, showing a 0.46% increase compared to 16.30% recorded in July 2021.”
The report said Akwa Ibom, Ebonyi and Kogi states witnessed the highest prices while Jigawa, Kano and Borno recorded the slowest rise in inflation.
“In July 2022, all items’ inflation rate on a year-on-year basis was highest in Akwa Ibom (22.88%), Ebonyi (22.51%), Kogi (22.08%), while Jigawa (16.62%), Kaduna (17.04%) and Borno (18.04%) recorded the slowest rise in headline Year-on-Year inflation,” the report said.
“However, on a month-on-month basis, July 2022 recorded the highest increases in Adamawa (2.87%), Abuja (2.84%), Oyo (2.77%), while Bauchi (0.82%), Kano (0.83%) and Niger (1.03%) recorded the slowest rise on month-on-month inflation.”