Nigeria’s food crisis has taken thousands to the streets to protest economic hardship and a Professor of Economics at the University of Nigeria, Nsuka, Enugu State, Osita Ogbu, has said that the government should deploy new initiatives to tackle the challenges faced in the country.
Ogbu said the worst hit by President Bola Tinubu’s reforms are the poor who do not have assets or funds to hedge against the cost of living crisis.
“If you go and check the research that has been done on inflation, you will immediately see exchange rates, interest rates, and petroleum prices as significant factors in inflation. And by the way, as economists, we know that inflation is the greatest enemy of the poor,” the professor said during a monitored interview on Saturday.
Nigeria’s inflation jumped to 34.19 per cent in June 2024 while food inflation hit a record high of 40.87 per cent, a significant rise from 25.25 per cent in June 2023.
President Tinubu was sworn into office in May 2023 when he announced the removal of fuel subsidy while the Central Bank of Nigeria floated the naira in June.
The UNN professor said there is a gradual approach to reforms, adding that when a government makes macro decisions, it must be aware of micro realities.
Prof. Ogbu said “The rich can actually rearrange their assets and take advantage of inflation. I’m sure you know this. Right now, there are interest rates that are paid on investments that are up to 25 per cent.
“No poor person has scarce resources to be invested, especially food inflation. Inflation is not something that any government toys with because of its effect on the poor. So when we say hunger in the land, hunger it is because there is a food crisis, the demand has remained the same, the behavior has increased, but the supply has not.
“And so we need to address these supply constraints head-on. And adequately, the interventions may be palliative, but they will not solve it. And I think what has been happening is that there seems to be some sense that there is business as usual.”
The UNN professor advised the Tinubu-led government to change it’s approach to reform.
He said president Tinubu needs to fix the way ministries are being run, adding that economic reforms should not be politicised.