EXPERTS ATTRIBUTE RISING INFLATION TO LOW PRODUCTIVITY IN REAL SECTOR
Some financial experts have attributed the rising inflation rate in the country to low activities in the real sectors. They told newsmen in Lagos on Monday that the rising inflation rate would retard the growth of the economy. The National Bureau of Statistics has reported that the inflation rate increased from 11.9 per cent in February to 12.1 per cent in March.
Mr Victor Ogiemwonyi, Chief Executive Officer of the Partnership Investment, said that the rising inflation rate was not favourable to economic growth.
He advised the Central Bank of Nigeria to strive to achieve and maintain single digit inflation rate. Mr Ayodeji Fagbenle, General Manager of Cash Craft Assets Management, said that the low productivity in the agricultural sector was a factor for the rising inflation rate. He said that most of the consumer goods in the country were imported; adding that Nigerians' penchant for foreign goods was responsible for the inflationary trend. Fagbenle advised the Federal Government to encourage agro-allied industries to produce more goods to boost the gross domestic product.
'The ability of the Federal Government to stimulate agro-allied industries and introduce appropriate economic policies will bring down the inflation rate,'' he said. He said that more jobs will also be created by reactivating the agro-allied industries. Mr Eddie Osarenkhoe, a former President of Finance Houses Association of Nigeria (FHAN), identified the partial removal of subsidy on petrol as another factor that had led to higher inflation.
He said that the removal of the subsidy had led higher cost of transporting food items from the rural areas. 'The apex bank should continue to monitor inflation rate and adopt policies that will bring down the rate,'' he said. He advised the Federal Government to monitor its spending and reactivate the real sector. Mr Samuel Nzekwe, a former President of Association of National Accountants of Nigeria, told NAN that high inflation rate would persist as long as the manufacturing sector was dormant.