State Of Economy: Solutions In Sight For Cost Of Living Crisis

The Minister of Finance, Wale Edun, along with the Minister of Budget and National Planning, Atiku Bagudu, has reassured Nigerians that the current surge in living expenses is being tackled.

The Governor of the Central Bank of Nigeria, Olayemi Cardoso, and the Chairman of the Federal Inland Revenue Service, Zacch Adedeji, joined the ministers in calming Nigerians’ concerns regarding the prevailing inflation.

Their statements were made during their participation in a sectoral debate convened by the House of Representatives focusing on the financial sector and its stakeholders, specifically addressing the ongoing rise in the cost of living. This event took place during a Plenary session in Abuja on Tuesday.

Edun, who also serves as the coordinating minister of the economy, said, “Where we are as a nation is a much better place than we were in on May 29, 2023.”

He elaborated that Nigeria faced a potential economic disaster due to fuel subsidies, implying that challenges were anticipated following their removal.

Edun acknowledged the rise in inflation and living costs, emphasizing President Bola Tinubu’s dedication to safeguarding the most impoverished and vulnerable segments of society.

“As things improve, there will be further intervention on behalf of the vulnerable to assist in the cost of living.

“Let us be confident, calm, and assured that Nigeria will change in terms of economic management and that there will be intervention in every sector,” Edun stated.

He emphasized the importance of addressing inflation, noting that full inflation constitutes 33 percent of the consumer price index.

Additionally, he underscored the necessity of revitalizing production, highlighting that the industry relies on energy for optimal operation. He also mentioned the President’s commitment to leveraging state power to mitigate vested interests in the oil sector.

Bagudu, on his part, emphasized the President’s commitment to national development, noting that the President acknowledges the challenges associated with people’s living conditions.

“What is happening in our country is obvious to someone visiting a construction site; we are very clear that we are on the right path and the challenges of the moment are being tackled.

“We are getting support from international partners, and they are all acknowledging the commendable steps that the president is taking.

“We have seen investments in the rail sector, the NNLG, and we assure you that we will overcome the challenges of the moment and sustain the economic growth as promised by the President,” he said.

Similarly, Cardoso expressed confidence that positive outcomes from Tinubu’s administration were already materializing and would continue to emerge in the near future.

“The concern as per the cost of living is genuine, and the urgency of the matter is not lost on us at the CBN, and we are working tirelessly to bring up a lasting solution.” Cardoso stated.

He indicated that inflation was projected to decrease in 2024, attributing this trend to enhanced agricultural productivity.

Furthermore, he mentioned that the challenges related to the exchange rate had been addressed, noting that they were exacerbated by speculation, heightened forex demand, increased capital outflows, surplus liquidity, and heightened demand, among other factors.

He stated that the CBN was addressing forex demand by clearing forex operations and adjusting the remuneration standard deposit, among other measures.

Speaking, the FIRS boss, Adedeji, clarified that the service functioned as a revenue-collection agency rather than a revenue-generating one. He highlighted the agency’s efforts to expand the nation’s revenue base.

He revealed that the revenue target for 2023 was set at N10 trillion, and due to decisions made by the president, they surpassed this target, reaching N12.3 trillion.

Adedeji highlighted that the president made the decision to rectify distortions in economic parameters and eliminate the fuel subsidy.

He noted an overperformance in VAT collection and company income tax, stating that the target for 2024 is to collect N19.2 trillion.

Adedeji explained that the N19.2 trillion target doesn’t entail new taxes but aims to expand the tax base by including more individuals.

Furthermore, he mentioned that currently, fewer than 60 companies contribute less than 60 percent to the nation’s company income tax.

Meanwhile, the Deputy Speaker, Benjamin Kalu, emphasized the critical need to acknowledge the urgency and significance of the agenda at hand.

He said, “We must also confront the stark realities of the economic, fiscal, and revenue challenges that our beloved nation, Nigeria, is currently facing.

“In the face of global economic shifts and domestic challenges, it is clear that robust reform measures are not just beneficial but imperative.

“We are at a pivotal moment where the decisions we make and the policies we implement will impact the lives of millions of Nigerians.”

He stressed that the reform efforts should not only target immediate needs but also establish a robust and adaptable framework capable of addressing future challenges and opportunities.

Furthermore, he emphasized that these measures should promote growth, encourage innovation, and improve the livelihoods of all Nigerians.

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