The World Bank has disclosed that import restrictions and non-flexible exchange rate management of the Central Bank of Nigeria are the major driving forces for food inflation in Nigeria. The Washington-based bank said this in a new biannual report by the World Bank known as Africa’s Pulse. The report read in part, “Rising food prices are the underlying factor behind the surge of headline inflation in Nigeria. Food prices have increased due to import restrictions and a nonflexible exchange rate management.
“This regime is keeping the official exchange rate of the naira artificially strong. And the naira has weakened significantly on the parallel market. Additionally, the central bank has restricted importers’ access to foreign currency for 45 products. This has reduced the supply to other importers. It said, “Food and fuel shortages put pressure on consumer prices despite fuel subsidies.
Inflation is expected to remain high as the negative effects of the war in Ukraine are still coming through. This is with an annual projection of 14.8% for 2022.
Recent figures from the NBS shows that Nigeria’s Consumer Price Index rose to 15.92 per cent in March.
This new rate is the highest the country has recorded since November 2021, when the inflation rate dropped to 15.99%.
The rise in the inflation rate in March shows that Nigeria is not left out in the global inflation surge currently being witnessed.
