Lagos — Hobnob News
Despite a slight easing in Nigeria’s inflation rate, the Lagos Chamber of Commerce and Industry (LCCI) has cautioned that ongoing insecurity and global geopolitical tensions may soon push food prices back up—posing a serious risk to economic stability and food security.
Speaking in Lagos on Tuesday in response to the May 2025 inflation figure of 22.97%, the Director-General of the LCCI, Dr Chinyere Almona, urged policymakers not to relax efforts in tackling the underlying drivers of inflation.
According to data from the National Bureau of Statistics, Nigeria’s headline inflation dropped marginally in May to 22.97%, down from 23.71% in April—marking the first decline in months.
While describing the slight drop as a “positive but modest shift”, Almona attributed it largely to the Central Bank of Nigeria’s monetary tightening measures, including increased interest rates and tighter liquidity control.
However, she warned that the inflation outlook remains fragile due to ongoing internal and external shocks, especially those affecting food production and supply chains.
“The recent spate of herdsmen-farmers clashes in the Middle Belt and recurring floods are serious threats to food harvests,” Almona said. “Additionally, the escalating conflict in the Middle East and stalled Russia-Ukraine ceasefire talks present external risks. These disruptions can fuel higher import costs, drive up oil prices, and worsen logistics challenges.”
She warned that these factors could reverse recent inflation gains, particularly in the third and fourth quarters of 2025, as food inflation remains a key component of Nigeria’s overall inflation index.
To safeguard recent progress, the LCCI urged the Federal Government to intensify efforts in:
Tackling insecurity, especially in farming regions
Investing in resilient agricultural infrastructure
Improving policy coordination across sectors
Dr Almona specifically called for increased support for dry season farming, expansion of irrigation systems, and agricultural mechanisation to reduce Nigeria’s dependence on rain-fed agriculture.
She also highlighted the importance of streamlining food transportation from rural areas to urban markets to cut post-harvest losses and reduce consumer food costs.
On monetary policy, she encouraged the CBN to maintain its current stance while enhancing credit access to agriculture and manufacturing sectors. She also advocated for the continuation of key reforms in the oil and gas sector, including the naira-for-crude policy and mandated domestic crude supply to local refineries.
“To protect the economy and the people, we must ensure that fiscal and monetary strategies work in sync,” Almona added. “We must also sustain the halt in Ways and Means provisions to avoid inflationary pressures from excessive government borrowing.”
As global uncertainties persist and domestic challenges continue to impact productivity, the LCCI’s warning underscores the need for sustained vigilance and policy responsiveness to avoid a resurgence in inflation that could worsen the cost-of-living crisis.
