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Lagos, Sept. 5, 2023 Prof. Akpan Ekpo, Chairman, Foundation of Economic Research and Training, has urged the Minister of Finance, Mr Wale Edun, to encourage the Federal Government to cut cost of governance, solve insecurity, and address rising inflation.
The expert gave the advice in an interview with the News Agency of Nigeria (NAN) on Tuesday in Lagos.
He spoke about his expectation from the new minister amid the rising inflation in the country which hit 24.08 per cent in July compared to 22.79 per cent in June, according to the National Bureau of Statistics (NBS).
The News Agency of Nigeria(NAN), Edun, a former investment banker with over 25 years of experience in the financial sector, was recently appointed by President Bola Tinubu as the Minister of Finance.
According to Ekpo, Nigeria’s inflation is not demand driven, it is a cost push, created by the subsidy removal and increase in utilities.
“So, the ways of fighting it, now, is if we can curtail expenditure which I doubt, because already they are expanding the cost of governance and that is expenditure and if you keep spending, that is the fiscal side, it will affect prices.
“The other way is to deal with the issue of security because if you look at inflation components, it is the food aspect that is raising the inflation rate.
“If you can solve security and let farmers go to their farm and the food component comes down, you might be able to deal with inflation.
“Again, don’t forget that the hardship during the attempt to redesign the currency that period has not been captured yet by the NBS; so, I see inflation to keep rising.
“My only worry is that it does not become what we call run-away inflation where we have no control,’’ he said.
The expert also blamed the rising inflation on exchange rate unification.
He said, “the other problem too is when they opened up the foreign exchange market for rate unification; the problem with the exchange rate in Nigeria is the supply side and access; we have seen that the margin has come back again.
“So, inflation passing through the exchange rate will be automatic; there is no way we can stop inflation because you will now need more Naira to buy dollars.
“This will continue until we have a productive economy where we export non-oil goods and services and earn foreign exchange, otherwise we will still have that problem with inflation.’’