Private Sector Urges Action on Logistics, Security, and Trade Policies as Inflation Persists

Despite a marginal decline in Nigeria’s headline inflation rate for the fourth consecutive month, private sector leaders are raising alarms about persistent inflationary pressures, especially in food and core inflation categories. In June 2025, Nigeria’s overall inflation eased slightly to 22.22%, yet food inflation rose to 21.97%, and core inflation climbed to 22.76%, reflecting continued strain on consumer prices. This contradicts the optimism usually associated with declining headline inflation, highlighting deeper structural challenges.

Dr. Muda Yusuf, director of the Centre for the Promotion of Private Enterprise (CPPE), identified key inflation drivers including high logistics costs, insecurity, volatile foreign exchange rates, and seasonal agricultural production. He argued that current macroeconomic improvements—like relative exchange rate stability—have yet to translate into real price relief, particularly because imported input costs remain high. Yusuf called for urgent policy reforms, such as adjusting tariff structures and revising import duty exchange rates, to reduce trade-related expenses and stimulate local industries.

Additionally, Yusuf warned of increasing cross-border demand for Nigerian agricultural products due to the weaker naira, which has made exports more attractive to neighboring CFA-using countries. This currency disparity is exacerbating food shortages at home by diverting local supplies abroad. He urged Nigerian policymakers to ramp up domestic food production to cushion the supply gap and reduce inflationary pressure from dwindling local food availability.

Echoing these concerns, Gabriel Idahosa, president of the Lagos Chamber of Commerce and Industry (LCCI), emphasized that food inflation, high energy costs, and inefficient supply chains continue to undermine economic stability. He expects the Central Bank of Nigeria (CBN) to maintain tight monetary policies in the short term. However, he suggested that if inflation continues to moderate, it may eventually allow for lower interest rates, improving credit access. Idahosa also stressed the importance of tackling climate-related disruptions and rural insecurity, both of which significantly hinder food supply and contribute to stubborn inflation.

Source: Leadership