The Bola Tinubu administration has acknowledged that food and essential commodity prices may never return to pre-subsidy levels, despite the government’s ongoing economic reforms aimed at stabilizing the nation’s economy.
In a statement released Thursday, Sunday Dare, the President’s Special Adviser on Media and Public Communication, pointed out that while Nigerians continue to face challenges following the removal of fuel subsidies in May 2023, key economic indicators show signs of recovery.
The subsidy removal led to a dramatic increase in inflation, causing a sharp rise in the cost of transportation, goods, and services, particularly food. This surge in prices prompted widespread public outcry and calls for government action. However, Dare referenced recent data from the National Bureau of Statistics (NBS), which revealed that Nigeria’s inflation rate has decreased from 34.8% to 24.48% year-on-year after a rebase.
The new inflation figures show food inflation at 26.08%, core inflation at 22.59%, and urban inflation at 26.09%. Additionally, rural inflation stands at 22.15%. The NBS recently updated its Consumer Price Index (CPI) to reflect the year 2024, aligning the country’s economic data with current realities.
Dare acknowledged that while prices may not return to pre-subsidy levels, they are beginning to stabilize across various sectors. “Prices of foodstuffs and other services are dropping across the board,” he stated, highlighting market surveys that confirm this trend.
He also explained that the rebasing of the CPI is a globally recognized practice that improves the accuracy of economic data, which is crucial for informed policymaking. “Rebasing provides a panoramic view of the country’s economic landscape, revealing both strengths and weaknesses, and offering valuable insights for investors,” Dare added.
The government also touted successes in the oil sector, with Nigeria’s crude oil production surpassing its quota at 1.75 million barrels per day. This development has reduced the country’s reliance on petroleum imports and eased pressure on foreign exchange. Additionally, a recent Bloomberg Africa report suggested that Nigeria’s economic outlook is improving, and the country may soon regain its title as Africa’s largest economy, with rebased GDP figures expected to reach nearly $500 billion.
While recognizing the hardships faced by Nigerians, Dare emphasized that the reforms are vital for long-term economic stability, stating, “Under President Tinubu’s leadership, we are witnessing the winds of change, with a new economic momentum in favor of the reforms.
