According to the World Bank, inflation caused by the COVID-19 epidemic put roughly 23 million Nigerians into a food crisis in 2021.
In response to the Global Study on Food Crises, the Washington-based bank stated this in its current Commodity Markets Outlook report.
Rising food costs, according to the lender, have exacerbated food insecurity in emerging markets and developing countries, particularly owing to reliance on food imports from Ukraine and Russia.
It went on to say that the COVID-19 epidemic had generated food insecurity around the world prior to the conflict in Ukraine.
“Rising food costs have increased food insecurity in most EMDEs,” according to the World Bank report. Given the reliance of a number of EMDEs on food imports from Ukraine and Russia, it could rise even further.
The pandemic had already had a toll on food insecurity before the Ukraine war.
“According to the Global Report on Food Crises, 161 million people were facing a food crisis or worse in 2021, up from 147 million in 2020, according to the Global Report on Food Crises. Democratic Republic of Congo (26 million), Afghanistan (23 million), Nigeria (23 million), Ethiopia (16 million), and Yemen (16 million) are among the countries whose populations are confronting a crisis.
Food insecurity would likely increase as a result of war-related disruptions in food trade, higher food price inflation, and higher expenses of running food aid programs, according to the report.
In a separate analysis, the International Monetary Fund predicted that the conflict in Ukraine will continue to put downward pressure on commodity prices, hurting oil and gas prices in 2022 and food prices in Nigeria and other countries well into 2023.
Dr. Akinwumi Adesina, President of the African Development Bank Group, also stated that fertilizer costs, rising energy prices, and rising food basket costs could intensify in Nigeria and other African nations in the coming months.
Apart from the pandemic and the ongoing conflict in Ukraine, the World Bank stated in a separate research that import limitations and the Central Bank of Nigeria’s non-flexible currency rate management were the main drivers of food inflation in Nigeria.
“Rising food costs are the fundamental driver behind the spike in headline inflation in Nigeria,” the paper stated. Import restrictions and a rigid exchange rate management have caused food costs to rise.
“The current administration is artificially maintaining the naira’s official exchange rate, despite the naira’s considerable depreciation on the parallel market.” In addition, the central bank has limited importers’ access to foreign currency for 45 products and decreased the availability of foreign currency to other importers.”
Nigeria’s Consumer Price Index climbed to 15.92 percent in March, according to the National Bureau of Statistics.
This was the highest inflation rate the country had seen since November 2021, when it fell to 15.99 percent.
Nigeria is not immune to the global price surge, as seen by the increase in the inflation rate in March.
