In separate interviews in Lagos that any nation experiencing rising inflation rate would not achieve sustainable economic growth.
The Bureau of Statistics on Monday reported that inflation rate climbed sharply to 12.6 per cent in January from 10.3 per cent in December.
Mr Titus Okunrounmu, a former Director at Central Bank of Nigeria (CBN), said that constant increase in inflation rate would lead to rising prices of goods and falling standard of living of the people.
Okunrounmu said that it would also increase the poverty level among Nigerians because the purchasing power would be eroded.
He advised the Federal Government to cut down its expenditures to reduce inflation rate.
Okunrounmu said that there was nothing bad in financing budget through deficit if the money would be judiciously used.
He said that borrowing could, however, be inflationary if the money was not spent wisely.
The former CBN director advised the Federal Government to rehabilitate the refineries to refine crude oil locally, since it was costing more to import the products.
Okunroumu also advised the Federal Government to focus more on the agricultural sector to boost food production.
He said that this would bring down inflation rate as more foods would be available to people at reduced prices.
Dr. Samuel Nzekwe, immediate past President of Association of National Accountants of Nigeria (ANAN), said that the rise in inflation would affect the purchasing power of fixed income earners.?
“The purchasing power of fixed income earners will decrease, while the prices of goods and services will continue to increase,” he said.
Nzekwe said that the major implication to the economy would be workers agitating for more salary which would lead to higher government spending.
He said that higher government spending would automatically lead to higher inflation.
Nzekwe said that the rising inflation rate would also reflect in higher cost of doing business in the country.
Mr Ayodeji Fagbenle, General Manager of Cash Craft Assets Management Ltd., said that massive production of cash crops for export would bring down inflation rate.
Fagbenle said that this would, in turn, boost the Gross Domestic Product (GDP) and increase the inflow of? foreign exchange.
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He said that the Federal Government should encourage agro-allied industries to produce more and generate more employment opportunities for the youth.
“The Federal Government’s ability to stimulate agro-allied industries and make appropriate economic policies to work effectively will bring down inflation,” he said.
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