The forecast was contained in the IMF’s Regional Economic Outlook for Sub-Saharan Africa as published on its website.
The forecasted figure of 16.1% will be the highest level in the country since October 2021. Figures from the National Bureau of Statistics showed that the nation’s CPI rose to 15.92% in March. This rise shows that Nigeria was equally impacted by global inflation.
The IMF also projected that the inflation rate would drop to 13.1% by next year. The agency, however, warned about the effects of inflation in its World Economic Outlook report.
A part of the report read, “In sub-Saharan Africa, food prices are also the most important channel of transmission, although in slightly different ways. Wheat is a less important part of the diet, but food, in general, is a larger share of consumption.
“Higher food prices will hurt consumers’ purchasing power, particularly among low-income households, and weigh on domestic demand. Social and political turmoil, most notably in West Africa, also weighs on the outlook.”
In a similar occurrence, the World Bank making Reference to the Global Report on Food Crises in its latest Commodity Market Outlook Report, cited the Ukraine war and Covid-19 as two major factors impacting food crises across the globe.
It said that the growing cost of food price is responsible for the food crises in emerging markets. The war in Ukraine has equally disrupted the flow in the food trade, leading to food shortages and a rise in the cost of food. It reiterated that before the war in Ukraine, the Covid-19 pandemic had already precipitated food insecurity globally.
In a separate report addressing food challenges in Nigeria, the World Bank said that while Covid-19 impacted food insecurity in the country, it said the restrictions on importation and the non-flexible exchange rate management of the Central Bank of Nigeria (CBN) were the major drivers of food inflation in the nation.
As contained in the report, “Rising food prices are the underlying factor behind the surge of headline inflation in Nigeria. Food prices have increased due to import restrictions and a nonflexible exchange rate management.
“The current regime is keeping the official exchange rate of the naira artificially strong while the naira has weakened significantly on the parallel market.”
Additionally, the central bank has restricted importers’ access to foreign currency for 45 products and has reduced the supply to other importers.”
The World Bank said that 23 million Nigerians have been driven into a food crisis as a result of the inflation caused by the Covid-19 pandemic.