Abuja (Nigeria): Dr Matthew Verghis, Country Director, World Bank Nigeria, has called on the Federal Government to reduce inflation, particularly food inflation, to bridge the gap between policy and people.
Verghis made this statement based on the World Bank’s latest Nigeria Development Update (NDU) report, titled “From Policy to People: Bringing the Reforms Gains Home,” presented in Abuja on Wednesday.
He said the NDU report showed that Nigeria had made significant strides in stabilising its economy.
According to Verghis, growth has picked up, revenues have risen, debt indicators are improving, the foreign exchange market is stabilising, reserves are rising, and inflation is finally beginning to trend downwards.
He, however, said that despite these stabilisation gains, many Nigerians were still struggling with eroded purchasing power, and poverty remained a pressing issue.
Verghis stated that the report estimated that 139 million Nigerians currently live in poverty.
He said that while the tight, data-driven monetary policy complemented by a non-expansionary fiscal policy was appropriate to tame inflation, it had evidently not been sufficient.
“Inflation is coming down, but not fast enough. These monetary and fiscal policies must be complemented by structural reforms that explicitly aim to reduce food inflation, which is driven by deep-seated supply and market inefficiencies.
“So the NDU builds on the public sector-led, private-sector-enabled growth agenda outlined in the previous edition,” he said.
He said that he did that by suggesting a three-pronged strategy to translate the reform gains into near-term improvements in the living conditions of all Nigerians.
“The first being reducing inflation, especially food inflation,” he said.
Verghis stated that the second recommendation was for the government to utilise public resources more effectively by ensuring that spending yields tangible development outcomes that benefit the people.
He said that the third recommendation was for the Nigerian government to expand the safety net by providing support to the poorest and most vulnerable members of society.
“These are not abstract ideas. They are practical steps that can turn macro stability into better livelihoods,” he said.
Dr Samer Matta, Acting World Bank Lead Economist for Nigeria, while providing an overview of the report, stated that food prices were on the rise, particularly for items consumed by people experiencing poverty.
Matta said that to address this challenge, trade barriers on food should be removed and domestic structural constraints should be tackled.
He emphasised the need for continuous updates to Nigeria’s social registry as a tool to target the poor and most vulnerable.
“But in addition to that, it is essential to provide domestic financing for social safety nets,” he said.
The NDU is a biannual World Bank report that assesses Nigeria’s economic and social developments.
It offers an in-depth analysis of the country’s medium-term development challenges.
