Indeed, the problems associated with soaring prices of foods are many and worrisome and the need to address them is appreciated by all meaningful Nigerians and their leaders.
In fact, this week, President Muhammadu Buhari has said that his administration will keep a keen eye on food inflation in the New Year. As part of the measures designed to achieve that goal, the president said he has directed the Central Bank of Nigeria (CBN) not to give foreign exchange to people for the reason of food importation.
Speaking at the fifth regular meeting with the Presidential Economic Advisory Council in Abuja, the president said: “we must eat what we produce.”
The incessant hike in food price in recent years is increasingly becoming more troublesome because of its negative outcomes, especially on the poor who spend a large share of their income on food.
This volatility in food prices has led to more malnutrition and food insecurity and social unrest among the poor. Meanwhile, the policy response to changes in food prices has become more challenging due to increasing price volatility and complicates the investment and consumption decisions of many businesses and consumers.
Nevertheless, the effect of food price volatility on economic activities has led the government to begin to respond with a new sense of urgency.
The increases in food prices have been attributed to a number of individual factors such as exchange rate, lending rate, money supply, real GDP per capita and oil price, among others.
And, no doubt, relationships exist between these individual factors and food price changes. Painfully, many households are net buyers or consumers of food in Nigeria.
Therefore, price variability distorts the consumption pattern of most households, and this leads to serious food insecurity in the country. And, regrettably, the high interest charges on loans for agriculture production have resulted in an increase of production costs.
The importation of agrochemicals has made procurement difficult, and again results in cost escalation arising from the depreciation of naira exchange rate. This has resulted in the low level of investment in agriculture by private sector players due to the increasing cost of farm input and a low profitability in farm enterprises in Nigeria.
No doubt, COVID-19 has had a dire effect on global economies. Rising infection rates have led to social distancing directives, persistent lockdowns, the closing of businesses, travel restraints, salary cuts, and a looming high unemployment situation.
Economic activity has shrunk dramatically and with it the food supply value chain globally. Like other countries, Nigeria has initiated a range of measures to try to curb effects of the pandemic. These have included waves of lockdowns in major cities and restriction of people’s movement.
These measures have affected all sectors of the economy. But food supply has taken the most severe hit. In fact, it can be argued that the measures taken to contain COVD-19 have had a major impact on food supplies in the country.
Of course, this is just as the shutdown of markets and slow transportation of foods because of the existence of many security check-points along the highways in Nigeria have resulted in wastage and inadequate food supply.
Insurgency, kidnapping, conflict and displacement of people had been topical for six years in northern Nigeria. Displacement of farming communities led to a decline in the cultivation of arable farmland, resulting in lower yield per hectare of agricultural land.
These displaced communities also need care and food supplies. This situation further increased the strain on food demand.
Communal clashes, banditry and farmers-herdsmen conflicts which started in the North-central region and since got spread to many other states and, unfortunately, these dire conditions have been compounded by the pandemic.
Insecurity and conflicts can be likened to a terminal disease, slowly eating its way into the system of the country. They stifle economic growth, stability and development. Insecurity and conflicts constitute threat to lives and property, hinder commercial activities, and discourage local and foreign investors.
However, in spite of all its foods-related problems, Nigeria is endowed with good arable land, weather and water supply and has the potential to be self-sufficient in food production.
With good policies and incentives in place, Nigeria can attract fresh hands to the farm and that is the best way to go. Our future as a country lies in our ability to feed ourselves.
“Going back to the land is the way out,” the president said. “We depend on petrol at the expense of agriculture. Now the oil industry is in turmoil. We are being squeezed to produce at 1.5 million barrels a day as against a capacity to produce 2.3 million. At the same time, the technical cost of our production per barrel is high, compared to the Middle East production.”
The country could even go beyond sufficiency and become an exporter of food. Therefore, because of the unpredictable changes in food prices, the Buhari-led government should encourage the use of alternative source of energy to reduce the effect of high oil prices on food prices.
More so, the government should provide soft agriculture credit scheme to farmers with low lending rate through cooperatives and banks so as to encourage smallholder farmers to increase agriculture production and overcome the problem of food prices instability and insecurity in the country.
Restoring sanity, peace in the country
Though restoration of peace to many security-threatened parts of Nigeria may appear almost an impossible thing to achieve now, President Muhammadu Buhari has called on Nigerians to believe that his administration can restore peace, security and prosperity in the country.
In a message to mark this year’s Christmas celebration, the president said providing security for everyone is a task that must be achieved.
He said the federal government, under his watch, would continue to support the armed forces and security agencies as they confront threats to our collective security.
There is no doubt that one of the ways to tackle insecurity is to strengthen our weak security system. Our country’s weak security system can be attributed to a number of factors which include corruption, inadequate funding of the police and other security agencies, lack of modern equipment, poor welfare of security personnel and inadequate personnel.
Corruption is bad not because money and benefits change hands in an unjust manner, and not because of the motives of participants, but because it privatises valuable aspects of public life, bypassing processes of representation, debate and choice.
There is the need for government to be proactive in dealing with security issues and threats, through modern methods of intelligence gathering and sharing, training, logistics, motivation, and deploying advanced technology in managing security challenge.
Importantly too, there is the need for the Buhari-led administration to champion the creation of an economy that will possess relevant social, economic and physical infrastructure for business operations and industrial growth.
This kind of economy will lead to generation of gainful employment and other forms of economic opportunities for the teeming unemployed youth and, ultimately take them away streets and criminal activities.
There is also the need for the Nigerian government at all levels to ensure that poverty is reduced and a realistic social security programme is implemented to ensure that the Nigerians meet their basic needs.
