How Insecurity, Fuel, Electricity Hikes are Hampering Nigeria’s Agricultural Yields
The Nigerian Economic Summit Group has said insecurity in the food producing region,electricity tariff hike,fuel price increase and hike in transport and logistic cost could stop Nigeria from harnessing the gains of improved agricultural productions in the coming months.
The development came as the group also raised red flag over uncontrolled poverty rate on account of rising unemployment in the land.
Platforms Africa reports that the group echoed its position in its economic report for the first quarter of 2021, noting that the country’s economic growth in the period under review was relatively weak.
“While we expect improved agricultural production in coming months to partially ease inflationary pressures, this positive impact could be suppressed by recurring key structural bottlenecks including insecurity in the food-producing regions, electricity tariff hike, fuel price increase and hike in transport and logistic costs,” it added.
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The group said that despite the re-opening of the land borders that the Nigerian government shut since October 2019, inflation reached a four-year high of 18.1 per cent in April 2021.
It described Nigeria’s economic growth trajectory is better described as jobless and less inclusive even in the heydays of high growth regime in the 2000s.
It said: “While the Nigerian economy recovered from recession in 2020 Q4, unemployment rate spiked to its highest level ever at 33.3 per cent in the same quarter.With the COVID-19 crisis heightening the rate of joblessness, many Nigerians are expected to fall into the poverty trap, going forward.”
The group said the World Bank estimated an increase in the number of poor Nigerians to 90 million in 2020 from 83 million in 2019,adding that this corresponds to a rise in headcount poverty ratio to 44.1 per cent in 2020 from 40.1 per cent in 2019.
The rising levels of unemployment and poverty are reflected in the persistent insecurity and social vices, with attendant huge economic costs,the report said .
It stated that huge dependence on proceeds from crude oil, leaving other revenue sources unexplored, indicates that Nigeria is not set to rein in debt accumulation in the short to medium term.
It noted that public debt stock continued to trend upwards, with a jump from N7.6tn ($48.7bn) in 2012 to N32.9tn ($86.8bn) in 2020.
It said public debts grew by 20 per cent between 2019 and 2020, adding, “This is partly due to the need for emergency funds to combat the global pandemic and alleviate its adverse economic impacts on households and businesses.”
Nigeria, the report said, needs more than an economic rebound, and there is a need to improve growth inclusiveness.
It added: “Nigeria has struggled to achieve inclusive growth for many decades. Since recovery from the 2016 recession, the economy has been on a fragile growth path until it slipped into another recession in 2020 due to the COVID-19 pandemic.This suggests that the country needs to attain high and sustainable economic growth to become strong and resilient.The relationship between economic growth and unemployment rate in Nigeria suggests that economic growth has not led to a reduction in unemployment rate – jobless growth.”
To reverse the trend, the group advocated the need for an urgent collaborative efforts between the government and relevant stakeholders towards addressing the constraints to value chain development in high-growth and employment-elastic sectors, including manufacturing, construction, trade, education, health and professional services, with ICT and renewable energy sectors as growth enablers.
