 Good morning and welcome once again to the breakfast on plus TV Africa. Our first major conversation for today is going to talk About the Nigerian inflation rate. We have caused the national Bureau of Statistics has made Revelation that it has dropped 0.37 percent consecutively in the last seven months of 2021 we're speaking this morning with an economist mr. Richard in no, yo To understand better what this means. Good morning beside no, yo Beside no, yo. Good morning. Can you hear us? Hide in we're very well. Thanks for joining us. I can hear you. Can you hear me? Yes? Now we can Thanks for joining us So so let's get straight into it, you know and understand what exactly this means before we look into further details What does this mean to the average Nigerian when the NBS says that inflation? Yes, can you hear me beside no, yo I Can hear you please go ahead. All right, so I'm asking, you know If you can break it down for the common Nigerian What does it mean when the NBS says that inflation rate has dropped by 0.37 percent consecutively? What does that really mean? Richard in all your can you hear me? What is having issues that we can actually buy more goose now that's what it means and it real says simply means That'll be your money. You can actually buy more goose. It simply means the price of good Goose and service is cut generality of Nigerians That simply means it before you as I used to buy a particular item I simply means right now that item is so low So on the overall for Nigerian people is good But I'm also sure it's good for Some persons who are investing in the market because for them it's all about maximizing profits So the drop in price may not believe reflects as in so well with them and also it's also imply that They may have to start thinking of other ways to see how they can actually keep up as a revenue to their business And if there's not the kidney may end up laying off as in Staff but on the overall is good for the Nigerian people. That simply means you can actually buy more goose But very few amount of money in your wallets Okay, but let's also You know big father, do you think that this is a true reflection of The market reality. I mean looking at the fact that food prices The cost of services are Sorting across the country Well, let me start by saying the Nigerian inflation rates. It's more like the Stock exchange markets today. You have the price of stock going high to bury have it coming down below So oftentimes the war impact is not seen Okay in the day of declaration But I think it's going to take a lot of work on the path of CBN on the part of investors and also my endurance to sustain the fall a Prize of goods and services But I think the average investor won the price of goods and services to won't go high because that way they make more money Okay, so do I have enough money to pay their staff for every investment they put out there But for the average Nigerian, what we care about is to ensure that we are paying less Okay Okay for services and and goose out there So for me, I believe is a good thing in terms of the value of The research finding and reports it is up for economists across country to actually conduct the top part review as a research So as data confirm or discredit it, but as it is right now We're yet to have Dafa to suggest in the real sense that what's the as in the period of statistics actually says true Okay Also speak further on What really determines whether inflation rate increases or decreases and and is there things that you would say the CBN has done That has made it continue to decline according to the NBS over the last seven months Well first let me start by saying So The inflation rates basically reflect some extents the culture of demand and supply How much people buying and how much for selling? Outside the fact that the volume of money circulation could go a long way to actually influence what I call national spending From the angle of positive income But overall one would say that the policy of the CBN some extents might have contributed in this direction through probably the The lowest came the CBN bonds not only just to financial institutions Okay, where as in financial institutions to come credit solution as an administrator giving SMEs as in cheap loans Just a single digits of nine percent. I still think that policy might have played out in terms of a pin in Manufacturers to produce more goose and that we force in the price of goose and services downward. So yeah We could have that link, but also it could also be the Nigerians are not basically buying because they don't have the money Because when the man is no high the price of goose naturally falls as the price of goose basically responds high That simply means that it's possible. Okay seems to Be very weak and for that reason we're not buying so investors have no other reason other than just for that Bring down the price of goose last accommodates as a more as an purchase from different as in demography So it could be one direction to be in all the direction born over I still think the policy of the CBN in respect to offering cheap loans to as an XM is To some extent that contributed to this drop in the inflation rates Okay, but you you mentioned that you that the implication of the fact that 0.3% in seven months means that we can Nigerians can actually buy Things I mean they can buy goods and services at a very Affordable rate, but I really would like to ask is that the reality? Is it really true? Or this is just in paper Reach out in OU Well, we seem to have lost connection with reach out in OU Hoping that we can actually connect, but you know, it brings us back to the conversation that for every other time I think the next work is a little bit cool. Yes. Okay, so if you can hang me, please can you respond Just like I said basically It simply means that we cannot buy more goose but buying is the function of how much disposable you have Okay, how much money you have within your wallets? And if you don't have enough money that simply means that even the benefit that comes with a fall applies of goods and services You'll be able to find nested. So that's just the truth about it But I believe that governments spending in Nigeria as a whole is very weak So we have to look for ways to increase the amount of money we have in circulation So now we Nigerians can actually have more money in there as in pockets and wallets and then you seem to actually drive the Economic growth we need so but the fact that we've had falling rates in terms of the inflation rate does not really suggest That we're going to have more to buy What is going to actually drive as in portrays upward would be at the bits of money in the hands of my injures as long as we have An unemployment rate is around the tree 0.1% and where a lot of Nigerians away about 20 million Nigerians don't have jobs. That simply means that Those who don't have jobs won't even key in to this very benefits we've seen So it's just a function of how much money you have in circulation unnecessarily The opportunity that the drop in inflation rate actually brings to all Nigerians. So you're saying that it has nothing to do with the cost of you know the cost of food and Services the prices of food and services that inflation has nothing to do with that So this reduction has nothing to do with the fact that you know me going to buy it's a bins rise The price would have actually reduced What I'm trying to say in real sense is this I'm saying is a good thing that we've had falling rates But this falling rates can be as a real of several of the facts or one it could be that My injures are not buying so much and when people are not buying so much What that implies is that investors would want to look for a way to stay in business by reducing the price of their goods and services That's what it means It could also mean that the federal government has done so well by providing the capital solutions investors needs to push The fact was just a new eyes and that simply means floating the market with cheap goods and services and then get an endurance to buy Okay, so it's just two ways as in two way thing. We're yet to actually get the right Theory or what you call tastes is to back up why we are in this fall It could basically mean several things. So the routes to get into the points where you have lower inflation rates could be as a sort of general demand being very very poor It could also mean that investors seems to have more money and increase in the capacity of production seems to the price of goods and services downward All right, what are the things that you kids you would say the government may be able to do to ensure that these Decline continues because we're currently at about 15 point nine nine percent In what ways can the Nigerian government assist, you know the Nigerian economy to ensure that inflation continues to drop? Oh Let me start by saying there's several things government can actually do Okay, government can actually improve on our investments in capital infrastructure Okay, the truth here is that there's a research. I'm currently overseeing and that very research shows that Nigerians seems to have eye Human capital thought intelligence. That simply means we're not a short supply of intelligence What we have currently is that we don't have the right budgets Okay, and the right priority to empower Nigerians to do better and to increase our production line and expand our production sequence So what government can actually do first invest in infrastructure energy as a sector? Say I can improve our energy quality and get regular energy across domestic residential industrial markets That is one for me too I think the government also needs to focus more creating the right great solutions for young Nigerians and entrepreneurs out there Passionate about bringing their vision into reality, especially as regard the creation of essential goods and supply So government can actually look into that direction Then I think lastly what we all just needs to do is to ensure that was trained in our jewellery It's very important for us to have strong jewellery because at the end of the day if you can't get justice Probably through your investment or let's say the tax given to you is very high You cannot get justice in local courts. It's also impact negatively on how you view the Nigerian economy Strengthening our domestic markets in respect to building the right energy sequence increasing as a credit solution to Nigerians who wants money to actually expand or invest into their own business and put the strength in the Nigerian jewellery All of this I believe to a very large extent as it would go along with to improve on bringing the inflation rate down At the same time also strengthen our security because if at the end of the farmers can get the security they need to produce crops That simply means the price of goose As in in the area of our culture would keep increasing So I'm just of the view that a way to go is for us to see how can address all of these issues of race Improve our energy sequence Invest in the capital market in respect to credit solutions to entrepreneurs Improve our jewellery and strengthen national security Okay, well, let's also go back to some of the things you have mentioned you talked about having a better budget Can you please for better perspective explain what you mean by having a better budget? How that can help, you know the decline in inflation, right? now first you see The budget basically is not just the legal instruments as we all told it's not just the legal instruments It's basically the road map road map for implementation It is a reflection of the power release we have as a country and it goes to show to a very large extent What and what we're supposed to expect based on what we have on paper. So the policy sitting on domestic Policy documents basically means that we all just need to understand that if we get our budgets in rights and our financing right That simply means that we can actually build new economic centers Expound our mineral district and then increase the overall economic supply system We have in the country, but if we end up right outpising the wrong things like for instance look at the budgets been proposed 19 billionaire for software for me does not really make sense We can put that money to build what I call as a data and software development center And then we can generate more software for Nigerians rather than spending that money on just software It does not really it goes to show that we don't have the right priority as a country. Okay, so Budgeting the right way simply means consulting citizens Trying out what citizens actually wants and then creating the rights as in system to allow those things to come to be Currently what we have basically are state actors who seems ought to care about what the citizens need And so they're just making priorities in a way that's basically annoy or probably Angers the citizen. So I feel that what we need basically is to fix our budget in sequence and show that we are actually But it's in based on programs projects plans and proposals put forward by citizens and not necessarily just few persons in Highly placed as a sector Deciding what the country should look like and not able to listen into the generality of the Nigerian people who wants to see better infrastructural investment and then a better as a national security outlook that gives us what I call the privilege to actually have Access to inflation rates that is lower than that of other countries and then bring investors to do what we expect investors to do To improve on production and supplies Our great thing you brought in the Nigerian people because that's what I'm going next When Nigerians read these things in the pages of the newspapers they really have no idea how to relate with it because if they go to the market The price of food stuff is still pretty pretty high And so can you share your views on how Nigerians are coping? With you know, the cost of living today and the value of the anirah while the government tells them that Inflation rates are improving and they're getting lower Grace I think in 1976 as a professor somewhere around I think Blangadash that said that is not just a no-for-all start the code economy statistics We need to actually translate the statistics into real time development for people and to improve as in the quality of life They have I agree with you But the trick here is the Nigerians are not finding it easy even though this government is going around telling the old word That's our Nigerians are Enjoying the government and things seems to be improved. I've not really seen re-improvement Okay 30 years ago. I was a little boy. I used to scream up network Okay, 30 years plus. I still see kids in my neighborhood as a scream up network So that simply means that we're not able to even address an energy problem that we've had for more than as in three decades That's one and two if you look at our production line We don't really seems to have so much to do this basically in this country Most of the things we consume from our cars to our television sets our radio and both of you are basically imported That simply means we're creating jobs next way. So Nigerians are not really finding this government's In the shape the government basically thinks the government's basically looks in so I Will suggest that the better thing we all can actually do right now is to continue the conversation Okay, good information going to Plotters where this information's can have the most impacts and then get the government on the fragile to do more Because there's always room to do more and that is just what I believe in terms of lifestyle quality of life We have in my injury I don't think it's something that we all should basically put out of from our road next work We have several pop holes and local cities and and communities and all those centers to Our poor investment in our culture is one can really say Nigerians seems to be enjoying this very good. All right So what being joined by Justin Chukul this morning? Good morning. Thanks for joining us Let me John St. Chukul, John St. Chukul not Justin. Okay. Thank you John St. Chukul for joining us this morning Let's get straight to this conversation. We're looking at the Nigerians inflation rate and according to the reports by the National Bureau of Statistics, it's been dropped by zero point three seven percent and that has gone on for like seven months very straight Now some persons have queried the methodology of the Nigerian Bureau of statistics Because if you want to Compare the current reality of the market the prices of goods and services are still, you know skyrocketed and that's not You know we can relate with the actual reduction zero point three percent It really sounds and really feels very good. So what do you think is the methodology of the Nigerian Bureau of statistics? You have an idea? Yes, I do, but let me clear One misconception about inflation rates and that will obviously I resolve the concerns of Miss Anasani who have about inflation. That's what they call this inflation and that's what they call deflation What we are witnessing here is deflation which means The date at which inflation rate is increasing has moderated is moderating. What that means is a previous month of October September inflation rate bill by sixteen point six three percent That's what that is to put in the name as long as if you take an average basket of goods and services in September 2020 and take their price and compare those prices with the prices of similar products in the same basket in 2021 September it simply means you would have had an increase of sixteen point sixty percent in September So if you have a basket of goods that cost you hundred naira by September last I mean September last Even September this year. It would cost you hundred sixty three couple Similarly when you talk of a basket of goods and services that you had as at October 2020 And you compare the price of those same basket of goods as at October this year The price would have moved by an average of fifteen point nine nine percent Which means if you have bought both those basket for hundred naira you will spend hundred and fifteen naira Ninety nine couple two by the same set of goods and services So what this are witnessing is that you are seeing inflation rate is the high But at the rate at which goods and services are increasing the price of goods and services increasing is not at the same pace At which it was it increased the previous month. It's like a very good I spent a hundred kilometers power then this rate to eighty kilometers power is still not a high speed But it's not the same speed So you will see of the impact or speeding in case you had an accident Which is what I just have finished in seeing a deterioration in the The participation power of their money of their income But that deterioration is slow is deteriorated at a lower rate Not that it's no longer deteriorating what they used to buy they can no longer afford to buy with same amount of income But the rate at which that deterioration is increased is Gradually weakening and that's what I need a self to understand That's the difference between deflation and disinflation in terms of deflation deflation Which is when the person inflation are declined So they are thinking that when we take a deflation deflation We mean that if you bought a basket of goods at hundred naira the same time this time lucky Now you are buying for maybe 19 naira. So the price of goods as I was I've actually begin began to go down That's a pretty interesting way of witnessing of breaking it down deflation versus disinflation so it's not like a lot really has changed it is just that the pace with which it is going bad is slower than it was Absolutely Okay, all right, Mr. Chukwu. Let's let's talk further about you know, how long you know, you know the the reality on ground When the NBS puts out these statistics and these figures, how long on the average do you think it takes before the Nigerian might start to see that there's actually a difference in the price of goods and services When you talk about how long it takes Nigerians to realize this is a different Nigerians actually feel it before the NBS published it Nigerians go to the market on a daily basis and they change realize that they say change in the average Of course, I suppose take for instance the report from NBS for October inflation day on average basis the price of goods and services increased by 0.98% between September last the September this year and October this in which in a month month or month So you realize that even in years who go to the market if you take a whole basket of what it was as a business measured by NBS, you will realize that the average price had increased by 1% But because this price price increase and not uniform Unfortunately, the item that most Families consume are increasing at a higher rate. And that's why if you look at the NBS figure You realize that food items, which is a major component of household consumption in Nigeria increased by 18.34% So for that on average basis A family will have realized that the value of goods a natural natural but by it has almost increased by 20% And they will feed the impact on their pause So in as much as we're saying all our time inflation increased by only 15.99 percent an average household Would have witnessed an increase of close to 20% on their expenditure costs Because food items increased by 18.34% And so the average family on going to the market delivers they are the one that feed the impact of price increase They actually feed the impact before NBS reported NBS reporting based on historical fact somebody go to the market today measure The impact on the goods and services they buy into the and then NBS report these figures by the end of But this time next month. So the average people are the one who talk Who actually feel the pain who actually can give you what the market trend is? And because if you look at the basket of goods and services consumer average household The there is high dominance of food item because of a level of income And that's why most people find it a feeling the impact of This inflation before even the NBS deposits All right, miss I know you can you still hear us? Yeah, I'm with you. Let's go ahead. Okay. Sorry. We All right, so I want you to go ahead and we may you know also get Mr. Johnson to also share his thoughts on this one What can be blamed or can we still blame COVID-19? For Nigeria's inflation rate and where our economy currently is is that's something that can still be blamed? If no, then what else would you blame as a factor in you know, this inflation figures? Well, you can't actually sit down and say COVID-19 is still Influencing the economy domestically. No, because if you look across the country ready, we've lifted bound on Several protocols that basically kept people at home and business is not doing what they want to do So I can't really link the current situation. We find ourselves into COVID-19 I believe that our budget in from the one is wrong. Okay, we don't put the right party I have made it clear without number that the quality of reality going to have in any country the function of the quality of budget And priorities the country make so currently I've not seen that as an priority in in the right direction So what we're just saying is basically priority in the area of Meeting the needs of some very highly placed as in persons in Nigeria It's not necessarily designed to drive the Nigerian economy in the right direction Just like I did mention we have a budget where 19 billion with a spend on software. I believe that we're making billion It's not I say if I believe I know with 19 billion can create a software development center Well can produce all manner of software we need to be able to drive Whatever interest we might have at a national security or a production line or a public surveillance So I don't even think the problem we have is linked to COVID-19 on the overall We have a very weak political institution that seems not to be driven by anything in Respect to building the economy we need but seems to be driven by just excuses So we just have to go back to policy documents and find policies that can actually work for the Nigerian people for the Nigerian country And then see how we can actually use that to rally our people to better reality Mr. Jekyll do you agree and The same question to you. Do you think that COVID-19 can still be blamed somehow some way? Or are there other factors that the Nigerian government has, you know failed at that has led us to continue to be at this stage With inflation. Well, I would think that it has much as you may still have some Effect of COVID but I don't think there's a major factor now if you look at inflation figures we are talking of You realize I can say earlier that food inflation is 18.34 percent If you disagree with the food inflation and be a say that the major increases in food inflation We are from food items like cereals wheat bread Two bars including potato potato to ban other tubas are produced locally and Egg ordinarily we should be safe from eating egg and I'm not sure we're important egg today So you wouldn't look at the food inflation of 18.34% and ascribe it to COVID And principally the reason why we're still having high food inflation particularly as it relates to Cuba, which is a main Cuba and cities which has a main Step of food in this country is because we've seen displacement of farmers to some of the farming boats as a result of heightened level of insecurity in the country We've seen logistic cost quite high because Third price is quite high today. If you look at the price of AGO which it is or which is a major Fierce search for the college vehicles. You recognize the fact that that's impacting on the cost of Food items even as you look at urban and rural inflation Urban inflation is a hundred basis points above rural inflation in the country today Then if you look at the non-core The core inflation which is all item excluding volatile food items You realize with an inflation rate of that 10.24 percent that would likely be driven by the exchange rates We've seen a deterioration of exchange rates in the past. At some point we saw an exchange rate of about 570 Naira to $8. So that pastry effect of that high exchange rate will Certainly have impacted on core inflation. So and these factors are likely Indigeneals to the extent that look your inflation, your exchange rate is a result of your reserve and your import and export And your food inflation is a result of food production in your country because most of the food we eat are locally grown food items Okay I would also ask it would be a two-in-one I mean this question will go to you and Richard in all you now name all of this in all of this conversation the commandment is concerned about improved standard of living and if all that we constantly say there's a decline or There's an increase how is the standard of living of the people so my question now is what can government do because Looking at the reality. I mean going to the market and you know being on the street You would actually feel the pains of Nigeria the standard of leaving has dropped drastically What can government do? What can the people do? You know to improve the standard of living? Okay, what the government has to do is address the fact on Propel high inflation rates. I had mentioned the never-insecreted as worsening food production and also leading to low productivity in from the farm produce Which is what we have a food inflation rating point three five three four percent beyond that we need to address the logistic supply Chaining the country particularly say in fast-forward logistic logistic in the country the seaports Are a nightmare These are lead to increase in the cost of goods that come into the country because of the cost of the region will have you the Road network is very weak that leads to high cost of transportation and the absence of red transport in most locations So that's one the government has to fix those things to have a single-digit inflation We must address the issue of insecurity to have a lower level of inflation and then as it relates to import induced inflation rates Then that you have to look at your history. Of course, luckily, we've seen some moderation in dollar rates in the country We hope that trade will continue and that will translate obviously in lower cost of imported items But as per what we need to do the fact is that there are two things that are impeding The standard of living on the genius one is higher inflation to is unemployment And that's why we have a very high misery index because when you combine unemployment at and the high inflation rate You have a high in misery index. So we need to address the issue of unemployment and that Once you are this one employment, you also address the issue of productivity because higher productivity means mean that you are producing more goods and service to your country and when you have produce more goods and service in the country You realize that the inflation will naturally moderate on its own. So the government has to focus on these key issues All right, Rita, you know you do you share the same thoughts? Well, I actually do actually do but let me start by saying Infrastructure right now What we have is just 20 century infrastructure And what we need is to the first century infrastructure From the energy line to the translation system Down to a medical facility and what the view all of this just needs to improve Unfortunately, the government is not prioritizing in the right direction. So I strongly believe that what people can do basically is to start calling on political parties to Start holding the right ideology. We want to see manifestos. We want to see real thing and not just Lien people telling you they're going to do this and do that So you should be able to engage them interlock the issue and get them to tell you how And all of that then my endurance also needs to realize that even though they feel to some extent that politics is a death A thing I think the science of my endurance to come to realize that politics remain the only mechanism true wish We produce government sure we should produce our leaders So is it time for people to get involved in the political system and use their influence to Rally around to get the right leadership to address some of this problem because at the end of the day It's always on to leaders and the budgets they have for the people So if the budget faulty if the mindset leadership is faulty what you have is just what you're going to have so energy sequence Production quality transportation next walk and both of you all of the 20th century infrastructures we have currently that can't even address the issue of to the person who we are confronted with Goes to show that we have to do some to look into our leadership. Just like The very as intelligent as an guest to people have Mr. Chukwach is set There's need for us to also be for security which I've also as in gave reference to because without security especially in The agro belt belts of Nigeria where a lot of these crops are produced That simply means you're going to be having increase in the price of I cut your produce and don't forget as a country we spend about 56.65 percent on food items alone And if you look into that alone you get to understand there's need for also strengthening our security network and maybe we also just need to invest more in Epic Nigerians to live better life because at the end of the day The insecurity we face is a function of the mindset of Nigerians So you can invest in kinetic resources and due from the defense system By the end of the day the mind of Nigerians are not in good shape because they're not happy with the governments You're still going to have mass against security And those infrastructures those kinetic resources will basically be wasted killing as in gets the Nigerians to kill Nigerians So I'm just of the view that time for us to actually start looking forward is now We need to start investing in the right capital infrastructure building the right energy portfolio and sharing that we invest massively in our transition system go across the country the pot hole Especially in south part of Nigeria is just this big people And how do you expect farmers to move their goods from local communities down to urban centers? These are all issues that drive the cost of goods and services Then CBN also needs to do more to expand credit facilities and solutions to Entrepreneurs so that that way they can actually get the resources they need to be able to drive the business Objects it don't forget that the group for instance You there are three things you can actually do is either you actually get a job But when you don't have a job you're spent to either further your career or start a business And if you don't have the resources to set up business you need that simply means you'll be able to contribute meaningfully To the economic margin and for also its better finance position There's need for us to invest more into providing the cut-per-solution that's in which they drive the business vision into reality All right, um, Johnson Chukwu, let's bring you in There's a myth that once prices increase in Nigeria, they never come back down If you've of course looked across market prices for oil and for cereal and for You know can't can't Food and some of some very random things Um, these prices are figures that we've never seen before Um, you know sardine for example that used to be about 250 naira is currently selling above 600 naira Um, there are certain things that Nigerians will now describe as luxury that you know a couple of years ago We're very basic Um, so mr. Johnson Chukwu, would you expect That there is a possibility is there a possibility that these prices will ever go back to where they were a few years ago Well, uh, what I would say is that it is a myth in Nigeria, but it has Uh, we had a census where some countries have witnessed, uh deflation in the uh In in in their country and then we saw prices reverse to even below what they used to be Uh, but Nigeria's situation is a bit unique unique in the sense that We've seen consistently over year in year out an increase in the population Who had a commercial rate increase in productivity? So that means that the level of productive productivity is declining as well as population is increasing And the simple logic of inflation is that when too much money is pushing a few goods or a few goods So for you to have this deflation you need to produce more goods and services Uh, more than the money, uh increase in money in circulation That would not witness that one of the factors that are driving uh important use inflation because because we are an important dependent country We have consistently in our currency depreciate or the value against foreign currencies So as long as that trend continues It becomes difficult to for you to price Imported goods at a narrow value lower than what it used to be If you used to exchange Naira about four or five years ago at $198 Naira $3 And today you are exchanging at officially that $430 Naira $3 Any good you bought for one dollar then would have been costing you $107 Naira today it will cost you $430 Naira as you mean you're using official exchange rates Then it becomes impossible for you to have that same good Even if the price has not moved from way in a sporting country for you to still have a reverse to $198 $7 Naira so for us to ever have a reversal of inflation rates We have to locally produce more goods and services as to lead to local deflation in our economy and then you also have to see an appreciation of Your local currency against foreign currencies to the extent that they will reverse to what they used to be You and I know that based on our current microeconomy conditions those factors seem too far-fetched Or too unrealistic to when you want to expect that we should see a reversal of exchange rate to maybe $118 Naira as we had in the mid-20 The 2025 to 2005 2006 it was about $118 Naira $8 For us to achieve that we must have a major boost in our foreign exchange earnings beyond export of crude The economy will take some time to achieve that we have not even put the structures in place to lead to something other than As to strengthening the currency back to what it was Maybe 10 20 years ago Naira are we producing enough goods and services as a country as to lead to deflation where you have so much goods And the sellers of these goods are begging people to buy them at lower prices And you may have one or two instances where one or two products have Declining the market prices, but generally at the general level the macro level that would be It's all of that payment to explain that Okay Johnson Chico, I would also bring a richardy. No, you today's some persons have complained about artificial inflation And I'm asking can the government use price control mechanism You know to actually stop that or should we allow the market forces of demand and supply You know to continue to play Well first let me start by saying the chief of Control of the Niger economy so a very large extent is the president So I think the likes of the late vice to Bami delia too Basically so the federal government then to court and the minister Of petroleum then Ali samadhi came to court Saying that government can't answer totally when it comes to price control Subsidies for me is a global as an issue Where government across the globe subsidized products and that's for me is price control So I think what we need is force to actually manage both our price control mechanism as well as also Great same room for market forces to also some of this as an issues But on the overall there's no way any country can actually run without some level of subsidization In the built-ins also intervenes When it comes to the issue of rising price So we just have to find out the right policy mix So say I can actually bring Price control at the same time also Great since the necessary conditions for market forces to actually rise when they need a rise for us to actually have an economy That works for home. All right. Let's bring in johnson tucco. What are your thoughts on that? Do you agree with him or you share different thoughts? Okay, I think he dwells on Subsidia Which he said that every economy government subsidizes one of the some of the what he considers as critical to the economic Development of the society But I think your question is whether government can introduce price controls Uh, as a make imagine a mechanism to reduce inflationary total moderate price price levels Uh, I I know that price controls have never worked anywhere in the world At the basic thing and when you try to control price, of course, you are not controlling supply or demand You push that commodity to the parallel market or the black market will pay Prices where people pay premium beyond what the market prices would have offered the man. This is very simple This is how it works If we have as a country we are demanding 10 million units of particular product and we're only producing five million units of it And the demand daily demand is 10 million units and you want to put the price cap on that product So that you take people 10 million people want to buy it Uh, what will happen is that? because the people who are telling there are no fools the people will take the product out of supply And take it to the parallel market and people are going to buy those products much higher prices than they would have bought them If you are left smart, but if you leave them in the open market, what do you call market? Maybe instead of 10 million people wanting to buy prices will go up to some extent only five million people want to buy it Because only five five million people can afford it because they are actually five million on supply But if you say the 10 million people that desire of it, which is what you call the difference between effective demand And uh, and uh, want people that want an item Would ordinarily No may not have the resources to buy it if you put the price cap on them They will struggle to buy it But if you allow market forces to determine the price You have effective demand only those who have the resources to buy that product will buy it And then that will set a market price or what you call a equilibrium price But once you introduce force to say this product I mean we've seen this in the past there was a time when the current President when he was a minute ahead of state He they put in post price control. There was a price control, but they put prices on food items like milk And other states what happened those make vanish from the shelf floors And people have to go to the back end of the market to say okay this make that should have bought for 50 kubo I'm ready to buy for one naira because it can't even find it in the store on the floor of the market or the shelf floors So market price control can only work if the government has a way of boosting supply to meet demand So you must either do what? Constraint demand which is a very difficult into the if is something people really want But the most appropriate thing is stimulate increase in production so that the Value quantity of goods produced will meet the demand of the society and that's when prices will moderate I had talked about this earlier that the best way to Take inflation is to increase the level of production in an economy So that the quantity of goods for services produced will increase beyond the demand of the equivalent and then Those who are selling the product will begin to come and buy the products and the market power We move to the consumer so we now be bagging for lower prices But as you have no production market power remains with the supplier Who will determine the prices that they will say the goods all right? Richard in oil and john sinchuku Thank you both for being a part of the conversation this morning and speaking about niger as inflation rate Of course, I'm looking forward to other very interesting conversations with you too. Have a very beautiful Tuesday All right many thanks for joining us. We appreciate And that's where we will of course be saying goodbye this morning if you missed out on any of uh, well Very interesting conversations. Remember what to catch up. We will work towards having a conversation on the n-sides panel Hopefully some time tomorrow and of course also speak about it It's a plus TV Africa on facebook and instagram as well as youtube do have a great morning. I am messy