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How Nigeria can address high food inflation and food insecurity
With Nigeria’s food inflation firmly above 20 per cent this year, we look into the challenges and actions of the government to address the trend of high food prices and food insecurity in the country. Ayodeji Balogun, CEO of Afex Commodities Exchange joins CNBC Africa for more.
Mon, 20 Sep 2021 12:04:59 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Impact of COVID-19 on agriculture production and food supply
- Influence of commodity prices on food inflation
- Government interventions and the importance of a multi-pronged approach
Nigeria has been grappling with high food inflation, which has been persistently above 20% this year. The CEO of Afex Commodities Exchange, Ayodeji Balogun, sheds light on the factors contributing to this concerning trend and the actions taken by the government to address the issue. According to Balogun, the increase in food inflation can be attributed to a systemic combination of factors. The first factor he highlights is the impact of the COVID-19 pandemic on agriculture production last year. The lockdown restrictions disrupted the supply of fertilizer, essential for crop production, and hindered farmers' access to farmland and mobility. This disruption occurred during the crucial planting season, leading to a decrease in food supply. The second factor Balogun points out is the influence of commodity prices on food inflation. He explains that the cost of inputs, such as wheat and other imported products, is tied to the forex market, affecting local food prices. Additionally, Nigeria's low productivity per capita, with food production growing at a slower rate than population growth, contributes to the food inflation crisis. Balogun emphasizes the need for a comprehensive approach to address these challenges. He acknowledges the government's efforts, such as distributing food storage facilities to 19 states and implementing interventions like the strategic food reserves for maize and rice. These initiatives aim to stabilize food prices and reduce the impact of price fluctuations on consumers. Balogun highlights the importance of addressing security concerns, especially in the Northern regions, known as the country's food belt. He underscores the interconnectedness of security and agriculture, emphasizing the need for a holistic strategy. The government's focus on expanding agricultural land and promoting food production demonstrates a commitment to long-term solutions. Balogun commends the government for its initiatives but underscores the need for more comprehensive and sustained efforts to tackle food inflation and food insecurity. He calls for a multi-pronged approach that addresses both short-term challenges and long-term sustainability. Balogun's insights shed light on the complexity of Nigeria's food inflation crisis and the imperative for coordinated actions to ensure food security for all Nigerians.
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