Nigeria grapples with a sharp spike in imported food prices, soaring to a staggering 34% over the past year, according to recent data from the National Bureau of Statistics (NBS). This marked a significant 200 basis point increase from March 2024 figures, intensifying economic challenges for the nation.
Despite government initiatives to curb food imports in a bid to alleviate escalating costs and economic strains, internal and external factors including disruptions in global supply chains following the Covid-19 pandemic and the Russia-Ukraine conflict, alongside surges in global oil prices, foreign exchange scarcity, and subsequent currency depreciation have fueled Nigeria’s reliance on imported food.
In April alone, Nigeria witnessed its inflation rate rise for the 16th consecutive month, driven by a triple surge in electricity tariffs and mounting transportation expenses, further exacerbating economic pressures.
Comparing year-on-year data, April 2024 recorded an inflation rate of 33.69%, marking an 11.47 percentage point increase from April 2023 figures, signaling a substantial rise in the cost of living over the past year.
Food inflation surged to 40.53% year-on-year, attributing to a significant increase in prices across various commodities including millet flour, garri, bread, yam, and other staples. On a month-to-month basis, food inflation slightly eased, indicating a 1.11% decrease from March 2024.
Kogi retained its status as the most expensive state, with an all-items inflation rate of 40.84%, followed closely by Kwara, Ondo, Osun, and Akwa-Ibom, each experiencing soaring food inflation rates exceeding 45%.
Economists from the Financial Derivatives company anticipate continued inflationary pressures due to renewed currency volatility and heightened food prices exacerbated by seasonal factors. They project a potential interest rate hike by the Central Bank of Nigeria (CBN) in line with global trends.
As Nigeria grapples with escalating inflation and economic uncertainties, policymakers face mounting pressure to implement effective strategies to mitigate the impact on citizens and stabilize the economy amidst ongoing challenges.
