Experts Suggest Ways To Check Inflation

Financial experts, on Tuesday, advised the Central Bank of Nigeria (CBN) to introduce more measures to check the rising rate of inflation in the country.

They told the News Agency of Nigeria (NAN) in separate interviews in Lagos that the current high inflation rate could retard the growth of the economy.

The inflation rate, which stood at 9.4 per cent in August, has risen to 10.3 per cent.

Mr Akin Alabi, a Funds Manager at Regency Assets Management Ltd., blamed the rising inflation rate on high public expenditure on capital projects.

He said all manners of costly goods were being imported into the country, “which means a direct importation of higher prices into Nigeria”.

Alabi suggested that a ban should be placed on the importation of certain goods to check inflation.

“A combination of reduction in government expenditure and ban on importation of certain goods may prove effective measures for the economy,” he said.

Alabi also suggested that price control measures on certain commodities should be adopted.

Dr. Kazeem Bello, a lecturer in the Department of Economics, University of Ibadan, attributed the rise in inflation rate to shortage of some essential goods and services, especially agricultural products.

Bello said that government had left the development of the agricultural sector to rural dwellers who practised subsistence farming.

“The shortage of commodities has been one of the most fundamental causes of inflation in Nigeria,” he said

Bello advised government to address the shortage of these products, saying that increase in the production of these goods and services would be the most effective means of reducing inflation.

“Increase in the supply of these products will naturally force prices down,” he said.

Bello said another measure would be the overhauling of the entire distribution network and suggested that any one found hoarding goods or profiteering should be prosecuted to serve as deterrent to others.

Mr Wole Olowu, the General Manager of True Bone Microfinance Bank, said the persistent exchange rate depreciation had also aggravated the inflationary situation because of the volume of imports.

He said domestic industries depended primarily on imported inputs whose prices had risen overtime.

Olowu said the diversification of the economy through investment in non-oil sector would curb inflation and ensure economic growth.

He said inflation could also be checked through efficient mix monetary and fiscal policies.