The rise in inflation

THE stark reality is here. Astonishing figures from the National Bureau of Statistics (NBS) have confirmed the fears of many Nigerians about the rising inflation rate in the country, with the attendant corrosive effects on the citizenry, especially the most vulnerable categories of Nigerians. Nigeria occupies the fourth position in the global misery index, computed by taking the sum of inflation, unemployment and lending rates, minus year-on-year per capita GDP growth. According to the NBS, consumer prices rose by 18.72 per cent in January this year, as against 18.55 per cent in December. According to the NBS, this was the highest rise since September 2005. Naturally, those who are worst-hit by the steady decline in purchasing power are ordinary Nigerians.

The inflationary trend has made life miserable and beggarly for most Nigerians. Regrettably, going by the market indices, government’s efforts at stemming the tide have been ineffectual. Basic needs have almost gone out of the reach of most of the estimated 180 million population, while the real sector appears to have become comatose in the face of a warped and weird foreign exchange policy. In simple terms, the prices of food, housing and utilities have consistently risen, to the chagrin of experts.  Yet, government and its agencies keep insisting that the situation is under control and that there should be no cause for alarm.

It is, however, not enough for the authorities to acknowledge the untold hardships that Nigerians are going through, and then offer carrots. The critical question is whether the government is taking necessary measures to bring succour and relief to the peopmle. It beggars belief that top government functionaries claimed that unwholesome practices by law enforcement personnel were compounding the geometric rise in the prices of essential commodities, without doing anything to address the situation. The Federal Government ascribed the astronomical rise in prices to the domino effects of the rise in the pump price of petrol,  and the ubiquitous checkpoints mounted by security personnel on the highways. Such excuses only convey the impression that the government has become helpless. When a government becomes too hamstrung to enforce the law against erring personnel, the entire society is bound to suffer the kind of suffocation and frustration that Nigerians are experiencing now.

Frankly, we do not think that deploying trains to move foodstuffs and releasing the eight million tonnes of grains in the national reserves will curb the rising inflation in the country. As things stand now, releasing the stock in the National Grains Reserves would be a mere drop in the ocean; it would be quickly lapped up by the overstretched market. Can the government really saturate the market to beat down the soaring prices of rice, beans, millet, corn, and other essentials? We think not.

The solution to the nation’s current predicament lies in the government tackling the fundamental issues behind the inflation. It should retool its economic plan and take pragmatic steps to unravel the riddle behind the problematic foreign exchange rate in order to bring relief to the organised private sector, especially the manufacturing sector. Needless to say, it should also deploy all the necessary apparatus to clamp down on the law enforcement agents, including men of the Nigeria Police and the Nigerian Customs Service, whom it blamed for extorting money from motorists and traders on the highways. The ability to do so is partly why there is an institution called government.