By Grace Chigbu
Ota, Ogun – In a bid to address the alarming rise in inflation, Dr. Samuel Nzekwe, former President of the Association of National Accountants of Nigeria (ANAN), has advised the Federal Government to embark on a comprehensive economic diversification strategy with a primary focus on agriculture.
Nzekwe shared his insights during a media interaction in Ota, Ogun State, against the backdrop of the recently released inflation figures by the National Bureau of Statistics (NBS). These figures revealed a concerning uptick from 22.79 percent in June to 24.08 percent in July.
Highlighting the urgency of the situation, Nzekwe emphasized the significance of addressing food inflation, which stood out as the highest among the data provided by the NBS. This trend, he explained, indicated a tangible scarcity of food, culminating in the surge of food prices.
“The imperative of focusing on agriculture cannot be overstated,” Nzekwe stated. “By bolstering our agricultural sector, the Federal Government can effectively curb the nation’s inflation rate, given its far-reaching impact across various sectors.”
The economist elaborated that a robust agricultural sector would not only alleviate food scarcity but also stimulate economic growth, translating into lower inflation rates. To achieve this, Nzekwe advocated intensifying efforts to tackle the current insecurity challenges that impede farming activities. By securing the farmlands, farmers can return to their fields, thereby increasing food production.
Leveraging Nigeria’s comparative advantage in agriculture, Nzekwe highlighted the potential for boosting foreign earnings. Acknowledging the interconnectedness of sectors, he also underscored the importance of providing essential infrastructure such as electricity and a well-maintained road network. These foundational elements, Nzekwe explained, are pivotal for a thriving productive sector. With better infrastructure, manufacturers can produce goods at a reduced cost, ultimately contributing to curbing inflation.
Nzekwe attributed the persistent rise in inflation rates to the removal of fuel subsidies. The country’s heavy reliance on petrol creates a ripple effect across industries and households, leading to economic strains. Further exacerbating the issue, imports are priced in dollars but converted to the local currency, the naira, contributing to elevated costs and consequent inflationary pressures.
Discussing the future trajectory of fuel prices, Nzekwe predicted further hikes due to Nigeria’s limited control over the dollar’s value. This, coupled with other factors, contributes to the continuing escalation of the inflation rate.
As Nigeria grapples with economic challenges, Nzekwe’s call to diversify towards agriculture presents a viable solution. If effectively implemented, such a strategy can alleviate food shortages, stimulate economic growth, and create a ripple effect of reduced inflation across various sectors. With prudent investments in critical infrastructure and a comprehensive approach to economic diversification, Nigeria could be on the path to curbing inflation and fostering sustainable growth.