On Thursday, 13th of July, President Bola Ahmed Tinubu declared a state of emergency on food security in Nigeria amid soaring inflation rates. The announcement came through Dele Alake, special adviser to the president on special duties, communications and strategy, after a meeting with President Tinubu and stakeholders on the agriculture and food production value chain. Alake explained that measures in the governmental action plan would include an immediate release of fertilizers and grains to farmers and households to mitigate the negative impact of fuel subsidy removal.⁣

“We will deploy concessionary capital/funding to the sector, especially towards fertilizer, processing, mechanization, seeds, chemicals, equipment, feed, labour, etc.,” Alake said.”

In January 2023, Nigeria’s headline inflation reached 21.82% from 15.60% recorded in January 2022. According to the National Bureau of Statistics, that indicated a 6.22% year-on-year increase in headline inflation rate compared to the same period the previous year. By May, inflations had reached 22.41%. According to the Bureau, food and non-alcoholic beverages were the biggest drivers of inflation in the West African country. 

However, in the early days of June, the cost of living skyrocketed in Nigeria following the announcement of fuel subsidy removal by the new Head of State. “With the petrol subsidy removal, the government is projected to achieve fiscal savings of approximately N2 trillion in 2023, equivalent to 0.9% of the GDP. These savings are expected to reach over N11 trillion by the end of 2025,” a World Bank report projected. 

However, The bank noted that many Nigerians would be pushed into extreme poverty, if the government fails to provide economic buffers for households. Furthermore, the World Bank has forecasted headline inflation to hit 25% this year. But the latest announcement by the President Tinubu administration would see the Nigerian government implement interventions across the Agricultural value chain to create economic buffers for citizens. 

“In the immediate term, we intend to deploy some savings from the fuel subsidy removal into the Agricultural sector focusing on revamping the sector,” Alake added.

Last week, Nigeria announced its intention to utilize an $800 million loan it seeks to obtain from the World Bank as a form of palliative measure, as the nation gradually eliminates fuel subsidies. The loan will mitigate the impact of fuel subsidy removal on Nigerians.