In a recent interview on Channels Television’s Politics Today, Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, expressed optimism about the nation’s economic trajectory, highlighting that the high inflation rate is expected to decline in the coming months. This statement comes amidst concerns over the rising cost of living and the significant impact of inflation on the price of essential commodities.

Economic Growth Amidst High Inflation

The National Bureau of Statistics reported a rise in Nigeria’s inflation rate to 33.20% in March 2024, up from 31.70% in February. Food inflation surged to an alarming 40.01% during the same period, further straining the budgets of average Nigerians. Despite these daunting figures, Minister Edun emphasized that the economic policies and reforms implemented by President Bola Tinubu’s administration are gradually yielding positive results.

“Mr. President has achieved relative growth and stability in his first year in office,” Edun stated. “The necessary fallout of the measures that had to be taken were higher interest rates to fight inflation and attract foreign currencies, which was successful. In terms of inflation, it is coming down. It is expected and projected to come down over the next few months.”

Analyzing the Cost of Food Items

The surge in food inflation to 40.01% has had a palpable impact on households across Nigeria. Basic food items such as rice, beans, and bread have seen substantial price increases. For instance, the price of a 50kg bag of rice, which was around ₦30,000 in early 2023, has now soared to approximately ₦42,000. Similarly, a loaf of bread that previously cost ₦500 now costs about ₦700. These increases have stretched family budgets thin, making it challenging for many to afford essential groceries.

Minister Edun acknowledged these challenges and assured that efforts are being made to support both farmers and consumers. “Help and amelioration must be given across the board,” he said. “I have talked about help that should be given to farmers and consumers. There is also help for small and medium-scale businesses.”

Economic Stability and Growth

Despite the inflationary pressures, the Nigerian economy is exhibiting signs of growth. Edun highlighted that the economy is growing at a rate of approximately 3% per annum, which is above the population growth rate of about 2%. This growth is a positive indicator that the economy is moving in the right direction.

“It is very rare to have a situation where authorities, particularly the monetary authority, set their target fighting to bring down inflation and prices generally and at the same time striving to keep the economy growing,” Edun remarked. “We do have that. Quarter by quarter when compared to the first quarter of last year, the growth is up by virtually three percent per annum above population growth compared to about the two percent achieved by this time last year. So, we do have the economy going the right direction. We just need to stay that course.”

Future Plans and Support for Businesses

Looking ahead, the government plans to stabilize and support the broader economy, particularly focusing on big businesses and industries. Edun mentioned that by Monday, the economy stabilization plan addressing factors affecting large enterprises would be presented to President Tinubu. This plan aims to encourage investment, create jobs, and further economic growth.

Conclusion

While Nigeria continues to face significant inflationary challenges, the government’s efforts to stabilize the economy and promote growth are showing promise. The decline in inflation rates projected by Minister Wale Edun offers hope for a more affordable cost of living in the near future. As the government rolls out support for farmers, consumers, and businesses, there is a collective optimism that Nigeria’s economy is indeed heading in the right direction.