By Adedapo Adesanya
The Central Bank of Nigeria (CBN) has announced the allocation of 2.15 million bags of fertiliser worth over N100 billion to the Ministry of Agriculture and Food Security to mitigate the surge in food prices.
Nigeria is experiencing the worst food inflation in decades amid a weakening Naira, insufficient domestic agricultural production, and an over-reliance on expensive imported food.
Data from the National Bureau of Statistics (NBS) showed that the annual food inflation rate was 35.41 per cent in January, 11.9 per cent higher than the 24.32 per cent recorded in January 2023.
The rising food inflation has been attributed by the Ministry of Agriculture to the depletion of food reserves, insecurity, flooding, the weakening of the Naira, and supply chain disruptions emanating from the COVID-19 pandemic.
The scrapping of fuel subsidies worth billions of Dollars annually by President Bola Tinubu has been a further driver of inflation. Although there are indications that subsidy payment remains.
To help in an interventionist role, the governor of the apex bank, Mr Olayemi Cardoso, said on Wednesday that his organisation’s fertiliser contribution aims to amplify food production capabilities and foster price stabilization within the agricultural sector.
Mr Cardoso assured that the bank would continue to implement comprehensive measures to curb inflation but notes that inflationary pressures may persist, predominantly driven by escalating food prices, in the short term.
The central banker is targeting Nigeria’s inflation to moderate to around 21.4 per cent using inflationary targeting measures, which have so far not shown many results.
However, Mr Cardoso stressed the critical need to address food inflation as a pivotal aspect of managing headline inflation rates.
“The CBN has veered away from direct quasi-fiscal interventions and transitioned towards leveraging conventional monetary policy tools for executing monetary policies effectively,” he said.
“My team and I reiterate our unwavering commitment to prioritising price stability and instilling confidence in the Nigerian economy by upholding consumer price stability and ensuring a balanced foreign exchange market,” he added.
