17th October, 2018
Financial analysts on Wednesday blamed flooding and persistent herdsmen attacks for the steady rise in Nigeria’s headline inflation for two consecutive months.
The analysts spoke in separate interviews with the News Agency of Nigeria (NAN) Lagos.
They were reacting to the inflation figure for last month and the remarkable rise in food prices nationwide.
A professor of economics at the Olabisi Onabanjo University, Ago-Iwoye in Ogun, Prof. Sheriffdeen Tella, argued that the flooding and herdsmen attacks had impacted negatively on food production.
He said that imported inflation from countries Nigeria was importing raw materials and production equipment also contributed to the current high inflation in Africa’s most populous nation.
“We will need to live with rising inflation for some time until local content of local production improves considerably,” said Tella.
“Headline inflation has gone up again and the main cause is the food sector. It is expected at the planting season but prices are expected to come down during harvesting.
Mr Ambrose Omordion, Chief Operating Officer of InvestData Ltd., said that a rise in inflation was expected, in spite of various loans extended to farmers by the Central Bank of Nigeria to boost food production.
Omordion said that insecurity and killings by herdsmen drove most farmers out of their farms, which resulted to shortages in food supply.
He said that high cost of transportation, due to a lack of infrastructure and high cost of funding also contributed to the development.
“The rise was little as expected because impact of the 2018 budget is mild as many approved projects are not backed with cash and political spending is yet to trickle down,” Omordion said.
Consumer Price Index, otherwise referred to as inflation rate for goods and services, rose to the highest level since May at 11.28 per cent in September, 2018 against 11.23 per cent in August.
The Nigerian Bureau of Statics said that amid general increases in prices of goods and services, the latest rise was the second in two successive months after 18 consecutive months of decline.
The figure declined from about 17.78 per cent in February, 2017 to 11.14 per cent in July 2018.