Centre Advises Tinubu on How to Tame Soaring Inflation
The Centre for Social Justice (CSJ), yesterday advised President Bola Tinubu to take a holistic approach to taming the soaring inflation in the country.
A press statement by the Lead Director of the CSJ, Eze Onyekpere said it had become imperative that Nigeria’s economic managers embrace increased productivity, especially in the tradable and export-oriented sectors, including oil and gas.
It also called for the removal of export trade barriers in the agriculture sector in the short run, stressing that it can shore up Nigeria’s foreign exchange earnings which will improve the value for the naira against major international currencies, thereby limiting import-induced inflation.
“Improving security of lives and property through the right political will that guarantee value for money in the provision of security services in Nigeria. It should be recalled that security has been given the highest budgetary allocations at the federal level in the last 10 years.
“This will also improve agriculture’s contribution to the Gross Domestic Product (GDP) and food production thereby limiting food inflation which has been the major driver of inflation over the last one year. Improved security will further lead to increased oil and gas production for export and local refining.
“(Government should ) limit ways and means of funding of the federal budget to the statutory limit of not more than 5 per cent of previous years’ actual revenue in accordance with S.38 of the Central Bank of Nigeria’s Act 2007.
“It should implement a Nigeria first local content policy in federal and state public procurement to ensure that capital budget implementation do not put undue pressure on the Naira. Rather, capital budget implementation should create jobs, enhance local productivity and grow the economy,” the group stated.
The group urged the government to stop denying Nigerians access to their money and in banks as a means of mopping up what is considered excess liquidity. “This is a fundamentally flawed measure for the reduction of inflation,” it stated.
CSJ noted that rising prices is a symptom of the overall negative macroeconomic fundamentals and strong headwinds besetting the Nigerian economy, adding that beyond inflation, the naira was losing value, poverty and unemployment is increasing.
“There have been massive factory closures, increasing insecurity and population growth figures that almost outpaced economic growth.
“Furthermore, the short term and medium-term impact of economic reform measures (fuel subsidy removal and exchange rate unification) have not been properly articulated.
“The reforms were not accompanied by an evaluation/projection of their impact on the economy as well as countervailing measures necessary to limit their harsh effects on prices and other macroeconomic indicators,” it added.