BusinessDay

Rising food prices require govt’s timely intervention

There is an African proverb that says, “He who does not cultivate his field will die of hunger.” Nigeria has a vast expanse of arable land but food prices are increasing. Statistical analysis indicates that over the years about 60 percent of crops, fruits and vegetables harvested in Nigeria are wasted due to poor handling, packaging and weak local preservation methods.

This is quite evident from the mountains of rotten mangoes, oranges, pawpaw, plantain, banana, pineapples and vegetables seen in most of our markets and motor parks. With respect to rising food prices, we need not panic. We only need to do the needful.

Studies have shown clearly that any nation that cannot feed itself is vulnerable to external manipulation and pressure. As the Central Bank of Nigeria (CBN) defends our local currency with billions of US dollars, the apex bank’s loan to farmers was reported to have hit N1 trillion amid rising default rate. This is the total amount reportedly disbursed under the Anchor Borrowers’ Programme of the CBN as at the end of April 2022. The disbursements were to 4.52 million small-holder farmers, cultivating 21 commodities across the country, according to reports.

We must make concerted efforts to compete locally so that we can be relevant internationally. It is our belief that policy decision makers at the the highest level of government know what needs to be done so that the prices of food can be within the reach of the poor

Yet there is food inflation. Some food items are getting scarce and expensive to buy. In fact, a survey report shows that prices of some food items are rising on a weekly basis. How are we going to attain food sufficiency, public intellectuals are asking? What else does the government need to do in order reduce the prices of food items? These questions need urgent answers and attention because there is a mismatch between efforts of the government under the Anchor Borrowers’ Programme and the quantity as well as quality of food available in the market.

Today, our economy is down but not out. The poverty net is expanding, our agricultural output is poor, our industry capacity utilization is critically below par, and the political terrain is very slippery. These negatives are expected. Why? Over the years, most economic programs articulated at the highest level of government and put forward to solve some of the stated problems systematically and ecologically have failed. It is because implementation strategies were poorly executed. As we watch with keen interest the political game in which most politicians bank on massive deployment of cash to buy votes at party primaries, the National Bureau of Statistics recently released figures indicating that selected food prices recorded an increase of 42 percent in one year.

Statistics also revealed that bread and rice recorded 42 percent and 48 percent price hikes in 5 years according to the same NBS report. The rise in food prices is taking place as “inflation is projected to be double – digit in the medium term given structural issues impacting the cost of doing business as well as high food distribution cost.” However, some experts believe that the current steady decline in inflation would be sustained as they project a rate drop to 13 percent in 2022 and 10 percent by 2024. The statistics gave the prices of food items at states and zonal levels respectively in the last 12 months.

In spite of policy stimulus, one wonders why Nigeria’s economy cannot have a growth-generating power of its own outside the oil and gas sector. Some experts are asking if the nation’s foreign reserve is big enough to accommodate any shock that may arise from a sudden global economic recession? It is very sad that inflation is yet to be controlled in our country. Our balance of payments are in deficit, and our export of goods and services is low. Perhaps, these are the reasons why our currency is weak.

Even if our currency was strong, food catastrophe is looming globally as The Economist reflected in an article that “the number of people who can’t get enough to eat has risen by over 400 million.” There is already a warning by the United Nations (UN) for nations to take necessary action to avert the food crisis globally. In response to the NBS report and perhaps the UN’s caution, the Federal Government is making moves to tackle the rising food prices. We sincerely hope that the moves will yield positive results. As world food problems keep increasing, India has restricted its wheat export.

It is on record that India’s green revolution transformed the country from a hungry nation to a net exporter of food. India, Malaysia, Mexico, and others are countries Nigeria can take a cue from concerning their drive towards food sufficiency. These countries have reaped enormous benefits from their well-directed agricultural research institutes, whose works produced improved seeds, food preservation processes, and new strains of cereals which has stabilized their food security status.

Indeed, the chief architect of the Mexican green revolution on wheat production was Norman Ernest Borlaug, an American agronomist who received a Nobel Prize in 1972. He succeeded in doubling within a period of 10 years, Mexico’s wheat production. India equally reaped benefits from the green revolution idea. Rice and wheat production were multiplied several times. It is on record that India – where over one million people died of starvation in 1943 – ultimately became a net exporter of cereal in 1980. Food, shelter and clothing are all on the first level of Maslow’s hierarchy of needs. It is necessary to mention that onion matter so much to some people and it is regarded as India’s most “political” vegetable. We have seen how the scarcity of onion in India coupled with its fluctuating price has ended the careers of prominent politicians. That is why Indian politicians care about the prices of food in the market.

Food crisis is global. But what is actually fueling the global food crisis? It is not just the geopolitical tension between the West and Russia but also the unprecedented heat wave that has impacted negatively on agricultural output. Temperatures are rising globally and rains are not falling sufficiently in areas where food is cultivated. What steps are being taken by the government in Nigeria to combat rise in food prices? Whether the delegates to political party primates are “dollarized” or not, over 200 million people would have to eat. What is the strategy in place to ensure that the nation is fed in years to come? Are we not vulnerable from the viewpoint of food security?

Some experts are of the opinion that those in authority in developing nations can avert food crises by doing the needful. The director-general World Trade Organization, Okonjo-Iweala, at the World Economic Forum in Davos, expressed her view recently, that the food crisis may last a bit longer if there is no safe corridor, and in that case, she urged developing countries to consider increasing their production. She affirmed that trade will be a key part of the solution to multiple challenges that the world is facing today, including the war in Ukraine, climate crisis, COVID-19 pandemic and food crisis. She suggested that “one thing that is common to all these crises is that no single country can solve any one of them.”

The world’s food crisis is already severe as prices are rapidly increasing and protectionism is spreading. But there is a good chance that some governments can stop it from getting worse if they take timely actions rather than panic. Currently, many nations have taken steps to curb exports in crops from wheat and sugar to cooking oils. If one can recall what happened in 2008 when there was global economic recession, the food crisis provides critical lessons as it underscores how government-imposed trade shocks can supercharge commodity prices.

Read also: Cost of living spikes as food prices rise 26% in 1yr

Some analysts strongly believe that if nations do not panic or start hoarding, they can halt the current food crisis from becoming a rerun of the food crisis in 2008. We cannot neglect the climate change phenomenon which is of great concern too. It was reported in the newspapers that inaction against climate change will cost Nigeria $460 billion. While the prices of wheat, corn and soy have soared, rice, a staple for more than 3 billion people globally, has so far been more stable.

Food experts and public intellectuals are of the view that nations should “be careful whatever they do on rice imports, exports, and controls.” Globally, developed economies such as the USA and China are grappling with elevated inflation and slowing growth, while consumers face a fast-rising cost of living as hunger spreads. Most countries are worried about the impact of high fertilizer costs on yields and drought has threatened crop production.

As food security is not likely to improve in the immediate future if countries in Southeast Asia hold back exports, the “real disaster” may likely be in Africa which has increasingly depended on food imports. Africa cannot afford a food crisis. The continent is currently suffering from disruptions to wheat from the Black Sea region. If rice is in abundance in Africa, it could help ease the pressure on wheat. It was suggested that consumers may wish to switch easily from wheat to rice and cassava products. Can Africans diversify their eating habits and build up huge buffer stockpiles in a bid to prevent price shocks?

As a people, we must match consumption with production. We cannot run away from production and export. This article is to subtly remind our politicians who are aspiring to elective and appointive offices that once elected, food scarcity is one of the numerous problems they would have to tackle in the next dispensation. So, they should be prepared in all respects.

We must make concerted efforts to compete locally so that we can be relevant internationally. It is our belief that policy decision-makers at the highest level of government know what needs to be done so that the prices of food can be within the reach of the poor. On a final note, this writer remembers a Jewish proverb that says that “sympathy does not provide food, but it makes hunger more endurable.” We should not panic. It is time for our policy decision-makers to take necessary action in order to avert a food crisis. Thank you.

Get real time updates directly on you device, subscribe now.