HomeFeaturesInflation Crisis Threatens FG's Zero Import Duty Plan

Inflation Crisis Threatens FG’s Zero Import Duty Plan

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Many low-income Nigerians who were hoping for a decrease in food prices may find their expectations unmet, as the implementation of the zero import duty policy on essential food staples is facing significant setbacks. These challenges could prolong the burden of high food costs for vulnerable households across the country.

The lack of coordination, ambiguous directives, and ongoing agronomic and infrastructural challenges are cited by stakeholders as major hindrances to effective policy implementation. Addressing these obstacles is essential for making meaningful progress toward food security and price reduction.

This situation arises in the context of renewed inflationary pressures that are diminishing the purchasing power of vulnerable citizens, which was the primary motivation for the measure aimed at stabilizing prices of essential food items. Yet, these economic challenges may undermine its intended impact on food affordability.

Nigeria’s inflation rate has been on a continuous upward trajectory since President Bola Tinubu assumed office in May 2023, climbing to an alarming 33.95% by May 2024. This sharp rise from the 22.4% rate at the time of his inauguration underscores the difficulties his administration faces in managing the economy.

To address the ongoing inflationary pressures as he celebrates one year in office, President Tinubu announced a 150-day duty-free import window for food commodities. This initiative seeks to mitigate food inflation in Nigeria, reflecting the government’s efforts to provide relief to citizens facing rising living costs.

However, Nigeria’s inflation rate which peaked at 34.19% in June 2024 before declining for two consecutive months of July at 33.4% and 32.15% in August, reversed the progress in September, rising to 32.7%, according to data released last week by the National Bureau of Statistics. This indicates that the hardship is far from moderate.

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Amidst this development, findings show that the softening measures through the zero-duty food imports are not going to happen any time soon as the government agencies involved have been tied down by role conflicts in the process of the implementation.

The initial setback, The Eastern Updates learnt, was the need for the Ministry of Finance to issue relevant directives for commencement, a situation which led to an initial two-month delay.

In light of the inflationary pressures affecting Nigeria, President Tinubu has announced a 150-day duty-free import window for food commodities, coinciding with the anniversary of his first year in office. This strategy aims to reduce food inflation and ease the financial burden on citizens struggling with high prices.

Customs announced on August 15, 2024, that it was prepared to initiate the duty-free import program, prompted by an implementation letter from the Finance Ministry dated August 08, 2024. This program represents a key component of the government’s efforts to address food inflation and support economic stability.

Nevertheless, the Eastern Updates has learned that two and a half months after the initial letter, the program has been further stalled by bureaucratic red tape and major disagreements among the agencies responsible for carrying it out. This lack of cohesion threatens to derail the initiative aimed at combating food inflation.

The Eastern Updates 

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