Youth Activist, Cmr. Friday Bako writes on inflation-reasons and impacts on public life and gives recommendations accordingly.

Nigeria’s Inflation rate hits 18.55%, an indication that people should brace up to spend more funds on goods and services.

Before you go to the market and in the process of buying goods/enjoying services and end up raining insults or hissing to someone’s father, mother or any supplier of goods and services, let me take some time to explain what the increase in inflation rate means to Nigerians and its impact.

My little knowledge of Economics made me to comprehend that by inflation; we mean “a period of persistent increase in the prices of goods and services which in turn gives rise to a fall in the purchasing value of money”

What determines or measures inflation is what Economists termed Consumer Price Index (CPI). Consumer Price Index measures changes in the purchasing power of a currency. It tells us what certain amount of money can buy for you at a given time as compared to a previous period (the variations or changes).

As at the end of November, 2016, our inflation rate was 18.48% but grew to 18.55% at the end of December, 2016 indicating that consumers of goods/services should be ready to spend more than what they spent in the preceding months on same goods/services.

In the period under review, what led to the increase in the inflation rate include; high cost of foodstuffs, housing, electricity, gas and other fuels (kerosene inclusive), water, clothing and footwear and not forgetting education.

It is indisputable that the prices of goods and services mentioned above increased in a geometric trend and kept persisting.

Who do you blame during an inflationary period?

Suppliers of goods and services, the consumers for consuming goods or enjoying the services are accustomed to or the policy-makers?

The suppliers/providers and consumers should completely be excused from the list of those to be apportioned blames to some large extent. The blame should go to the policy makers, this is because sound, good, and reliable economic and fiscal policies can address the issues of persistent price increase. Harsh, inconsistent and unfavorable economic and fiscal policies are factors responsible for inflation.

The impacts of inflation among many others include that savings/investment will be adversely affected as both will decline, spending on consumption will increase as people will spend more funds on goods/services than they have done before, there is likely to be poor hygiene as people may not feed well following the upward increase in prices of food items which many may not be able to afford, people who may fall sick due to poor hygiene may not be able to afford medical services as the cost will also be adversely affected, standard of living will fall, productivity will decline and if the above mentioned surfaced, they will affect our Gross Domestic Product (GDP) which will push us further into harsher recession. Despite the inflation, incomes through salaries and wages remain the same, a situation that means people will barely cope with the economic situation our nation is going through.

SUGGESTIONS (RECOMMENDATIONS):

1. GOVERNMENT:

There is an urgent need for the government to come up with a sound, key and reliable economic and fiscal policies that will immediately address the economic hardships the people are currently facing. This MUST be holistic and strategic at addressing inflation and the economic recession ravaging the nation’s economy.

Government MUST show visible commitments in sound policies that will bring the Nation out of the economic quagmire it has found itself.

There is also need for government to bring in good hands. By good hands here i mean technocrats who are experienced, knowledgeable and skillful on economic and fiscal matters irrespective of their ethnic, tribal, religious and political inclinations as long as they are men/women of proven integrity, probity and fear of God putting their antecedents into consideration.

Government must hurriedly diversify the economy and put in place measures that will end our over-dependence on oil which global price has been unsteadily low.

2. SUPPLIERS/PROVIDERS OF GOODS/SERVICES:

From my text, I deliberately exempted you (suppliers/providers of goods/services) from the blame on inflation but at this point I will want to appeal to you not to use the period of inflation to make yourselves stupendously rich by increasing the prices of your goods/services above what ought to be.

As an innocent final consumer, I met with a business woman who openly told me she was benefiting more in this inflation/recession period more than period of where there was stability in our economy and prices of goods/services.

Yes we all agree that there is national increase in price of goods/services but that should not be an excuse to increase the prices of your commodities/services above what should be obtainable. You must not made hyper-profits from goods produced/sold or services rendered. It is good to make good turnover/profit as owners of businesses but bad when you rob people or make them pay above what they should have paid to make yourselves super-profitable on account of the inflation. Supplier/Providers of goods and services must ensure that prices are fair/convenient enough after considering all cost incurred on the goods/services. In this case we must demonstrate empathy. By empathy here i mean the suppliers/providers of goods and services putting themselves in the shoes of the final/innocent consumers to feel what they are feeling due to the inflation. As good Muslims/Christians, we must not make consumers suffer unnecessarily struggling to pay for goods/services just because we want to make super-profit (shegiyar or mamunar riba).

Because of how some business owners charge outrageously during inflationary period of gaining above what is expected, i wish there could be a system in which prices of goods/services could be regulated to address overcharge on the part of suppliers/providers of good/services. May businessmen/women have discarded excellent service delivery and talk to clients rudely and cruelly.

3. CONSUMERS OF GOODS/SERVICES:

These particular groups are innocent and the bearer of all the burdens of inflation and economic recession. All of us are consumers of one form of good or service. There is need for consumers of goods/services to set priorities in terms of their needs/wants. In so doing, there is need for alternatives or opportunity cost. We must cut down on unnecessary spending on goods/services. We should ensure that what we are spending on are things that are absolutely needed and things we cannot do without.

The need to set priorities is key and cannot be overemphasized in this period of high inflation. We must be mindful of our spending and expenses with the available resources at our disposal. Avoid avoidable expenses and spend on unavoidable expenses putting your income level into consideration. Spend in line with your income level. Do not spend on what you don’t need and avoid wastage. Put in place good storage facilities that will address spoilage and decay. At this crucial time, it calls for cutting your coat according to your clothe not even size anymore. You have to be economically minded in all your dealings on account of the state of the economy. Thank you for taking your time to read this lengthy write up.

Yours Truly

Cmr. Friday Bako

Best Regards

Dalyop Bako Friday
Jos City, Plateau State.
Nigeria.
+2348065355491 & +2348090629932

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