LCCI seeks solutions to high inflation, interest rates

Lagos Chamber of Commerce and Industry has urged monetary and fiscal authorities to significantly address deep-rooted challenges contributing to high inflation, particularly in the cost of food and core categories. LCCI’s director-general, Chinyere Almona, made the appeal in a statement on Wednesday. Ms Almona acknowledged the government’s efforts to ease the monetary regime. She said the marginal drop in the August headline inflation rate to 32.15 per cent, down from 33.40 per cent in July, was on a good note, reflecting some policy impact. Ms Almona, however, noted that while the development represented a month-on-month improvement, the broader year-on-year comparison showed a troubling 6.35 per cent increase compared to July 2023. The LCCI boss also mentioned that the interest rate raised to 27.25 per cent presented a tense business environment.

“The excuse by the Central Bank of Nigeria that the monetary policy rate was raised due to fears of a petrol price hike is not a sustainable argument. We expect government to tackle the issues to benefit the Nigerian economy in a timely manner, too,” the statement said. Ms Almona urged the federal government to accelerate energy reforms to improve electricity generation, reduce reliance on costly diesel and petrol, and ensure stable power supply for manufacturers and small and medium enterprises. She called for improved transportation infrastructure to cut logistics costs with adequate investments in rail and road networks to ease the transportation of goods, reducing price volatility in consumer markets. Ms Almona further called for a more transparent foreign exchange management to reduce speculation and stabilise the naira. According to her, a stable exchange rate will help moderate imported inflation, especially in essential commodities and raw materials needed for local production.

“We reiterate our earlier recommendation that the CBN should work with the Nigeria Customs Service to fix the import duty exchange rate for a certain period to aid business decisions on importation. We urge the government to adopt a holistic approach to address inflation by boosting local production, stabilising energy and transportation costs, and aligning monetary and fiscal policies. We advise that the monetary authorities remain sensitive and focus on these troubling issues because they adversely impact businesses in Nigeria,” she said. NAN