The Lagos Chamber of Commerce and Industry has said the slight moderation recently recorded in the country’s inflation is cheery news to the business community, just as it expects some respite from the biting effect of the unbearable high interest rates.
It tasked the Ministry of Livestock Development to play a critical role in addressing shortage of poultry and related products.
The Chamber’s Director General, Chinyere Almona, made these disclosures in a statement she signed on Friday.
Almona noted that in the recent past, businesses have had to cope with bloated interest rates for several months.
“As we begin to see the impact of actions taken by monetary and fiscal authorities, we urge the government to sustain all the cost reliefs initiated to reduce the cost of doing business in Nigeria,” Almona advised.
The Chamber noted that core inflation rising from 27.49 percent in June to 27.47 percent in July “is a scenario that calls on policymakers to choose the appropriate policy mix to drive down the deceleration of inflationary pressures continually”.
LCCI said in addition, the current inflation environment should also be used as an opportunity to look beyond and consider longer-term issues, particularly in the economy’s agriculture, manufacturing, and export sectors.
The statement reads in part: “The many programmes and policies initiated to tame inflation and stabilise the exchange rate must be sustained and extended to impact more economic players, thereby multiplying the economic effect in the medium term.
“We advise the government to sustain and expand programmes and policies like the import duty waivers on food and drugs, the introduction of Compressed Natural Gas (CNG) vehicles to give way to cheaper means of transportation, the several foreign exchange market reforms to boost supply, the decision to make provision for direct crude supply to local refineries, and the transition to renewable energy.
“To extend the recorded ease in prices, we must attend to the root causes of food insecurity in Nigeria, such as empowering lowly skilled farmers with access to required information on crop production, market prices, and technology; providing more agricultural input like fertiliser and extension services; invest more in agrarian mechanisation; resolve land use conflicts; mitigate climate change impact on farmlands; and initiate modern irrigation methods.
“The not-too-good news from the Central Bank’s report that the Purchasing Managers Index for July fell below the optimism level of 50%, marginally falling to 49.7%. Consistent work is needed to create some certainty in the policy environment to boost the confidence of industries in the economy in the coming months.
“The reinforced fight against crude oil theft and pipeline vandalism must be sustained to ensure a higher output that can cater to the crude supply requirements of local refineries.”
Beyond food crops, LCCI asserted that poultry and fisheries are key drivers of food inflation as common food items like beef, fish, eggs, and chicken have recorded consistently high prices in recent months, contributing significantly to food inflation in the country.
The Chamber specified that the newly created Ministry of Livestock Development is expected to play a critical role in addressing this shortage of poultry and fisheries “at a time like this”.
Almona also stressed that with the Local Government Areas having access to more funds, LCCI expects to see a grassroots development revolution as the subnational governments take more responsibility for the economic development of their states and local government areas.
She advocated that the subnational governments should replicate the tested initiatives at the federal level to create the vast multiplier effect the economy needs.
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LCCI boss pointed out that the perception about Nigeria continues to take a hit, and investors’ confidence is being beaten down due to threats and fears of insecurity, adding that the fight against all the elements of insecurity must be sustained to improve on the recent wins by our armed forces.
LCCI urged the government to support the economy’s productive sector and incentivise the production of exportable goods where the country has a comparative advantage to increase FX earnings and sustain stability in the FX market.
Recall that Nigeria’s inflation moderated to 33.40 percent in July 2024 from 34.19 percent in the previous month, as released by the National Bureau of Statistics.
The Eagle Online reports that slight moderation recorded in the month was the first since December 2022, reflecting ease in price pressures due to a slow-down in demand and some monetary and fiscal policy interventions.
