Despite the Nigerian naira’s steady rise against foreign currencies, prices of goods and food items remain high in most markets and retail outlets across the country. This persistent issue has left many consumers frustrated, with hopes of government intervention dashed by the Federal Competition and Consumer Protection Commission (FCCPC).
The naira’s recent strengthening in the foreign exchange market has been a source of optimism for many Nigerians. However, the expected relief in the form of reduced prices has not materialized. Instead, prices of essential goods continue to remain sticky, much to the dismay of consumers who had hoped for a reprieve.
While acknowledging the concerns of the masses, the FCCPC made it clear that price control falls outside its jurisdiction. The commission emphasized its commitment to safeguarding consumer interests and ensuring fair market practices, but it stopped short of promising direct intervention to address price hikes.
One of the major factors contributing to the persistence of high prices is the existence of oligopolies in key sectors of the economy. In industries like cement manufacturing, a handful of dominant players maintain significant control over pricing. As a result, cement prices have soared, reaching levels that were previously unheard of.
Similarly, household items such as fridges, cookers, and air conditioners have seen little to no reduction in prices, despite the strengthening of the naira. Double-door fridges, for example, continue to command prices ranging from N250,000 to N500,000, while a four-burner gas cooker sells for as much as N145,000.
Local food items have not been spared from the price surge either. Sellers attribute the high prices of items like yam, palm oil, and beans to increased transportation costs. Transporting goods from agrarian states to urban centers has become prohibitively expensive, driving up the overall cost of these essential commodities.
While some consumers blame manufacturers and distributors for the high prices, industry insiders paint a different picture. According to Mr. Benjamin Obayi, a wholesale dealer, the cost of goods is unlikely to come down unless the government reintroduces the oil subsidy regime. High production and transportation costs, driven in part by the high cost of diesel and petrol, have made it challenging for businesses to reduce prices.
Experts, including the President of the Institute of Fiscal Studies (IFS), Mr. Godwin Ighedosa, agree that addressing systemic issues like insecurity is crucial to making food items more affordable. In addition, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, emphasized the need for patience, noting that price adjustments take time to reflect changes in input costs.
The recent drop in the value of the dollar has provided some relief, but manufacturers caution that prices cannot be expected to decrease overnight. Many businesses still operate with old stock purchased at high prices, and until these inventories are depleted, prices are unlikely to see significant reductions.
Amid calls for government intervention, manufacturers and distributors are grappling with a myriad of challenges that continue to inflate production costs. High electricity tariffs, poor power supply, and increased transportation costs all contribute to the high cost of goods.
While consumers express frustration over the lack of immediate relief, the FCCPC reassures them of its commitment to enforcing fair market practices. The commission warns against price gouging and unfair trade practices and pledges to invoke relevant laws against perpetrators.
Looking ahead, consumers remain hopeful that the government will address systemic issues plaguing the economy and create an environment conducive to fair market practices. However, experts caution against the establishment of a price control agency, citing potential politicization and inefficiencies.
In conclusion, while the recent appreciation of the naira has provided some relief, the persistent high prices of goods and food items continue to be a source of concern for many Nigerians. Addressing the root causes of these price hikes will require a concerted effort from both the government and industry stakeholders.
Source: The Guardian
