 Thank you for staying with us still to breakfast on plus TV Africa and right now It's time for a hot topic. Well, this one we're discussing the need for government to fix prices of goods And our guest today is Balaon or Luja day. He's a public affairs analyst and we'll just be making sense of this Good morning, Mr. Balaon. Thank you for joining us Yeah, good morning. Nice to be on the program. Thank you so much. It's good to have you good to have you here All right. So we're talking about the need for government to fix the prices of good and I'm sure as you're aware Femi Falleno had, you know, approached the court talking about the the prices of goods for, you know, certain items And he actually, you know, quoted some things from the Constitution that some of these things needs to be fixed ASAP By the government, but let's just have your thoughts on this before we dive right in Okay, I think Mr. Falleno has good intentions. I believe the judge as well. Both of them are legal people So you have this tendency to see everything from your point of from a legal perspective. You see a problem You are also concerned you want to provide a solution So you deploy the tool that you are familiar and comfortable with, which is the law That is what I have seen Mr. Falleno and the judge do But is this a solution? Even in communist China, as a matter of fact, we must ask questions Why are we at this junction? Have we done this before? Yes, we have We did it. We did it several years ago when our people were even queuing up for milk and sugar and all of that Price fixing doesn't work. It doesn't help anybody Anybody even in this eventually once that created was a huge hold of accountability He gave back to what we call the subsidy of several years Slippery slope that we must avoid rather than thinking of fixing prices We have to think of more innovative ways of intervening in the prevailing problem that the country is facing Price fixing doesn't work I was about to ask how practical is this because if the government has to fix the prices of certain goods So let's take for instance rice, gari, sugar, milk, bicycle and spare parts, vehicles as well Those were some of the things that Mr. Falleno listed in his suit If the government starts to fix these prices, how does that even help the suppliers of these products? Because if the government fixes the prices, that means regardless of how much I bought them Regardless of what the dollar is saying right now, regardless of the rent I have to pay Regardless of everything that sums up to the price that I am actually asking people to pay for this thing That means I might just be at a loss if the government because most times the government might even fix something that is lower to what I actually paid to acquire these goods So how practical is this for the government to even decide to fix these prices? It's absolutely impracticable. I mean you are bringing out the ridiculous side of that direction now or that judgment How much I will sell my item should depend on my cost profile. You don't determine my cost profile for me You don't know how I've been able to build it up. So how can you determine how much I should sell it? It's almost ridiculous in the real sense of it So you have to fix different prices for different states I believe and within these states You also have to fix different prices for different locations within the states Because the cost of living in Lagos Island or Victoria Island is not the same And the cost profile of providers in Victoria Island is not the same as that of Egbeda or that of other parts of Lagos So you will not only be determining the prices in Nigeria, you will determine the prices by state Then you will come to the state level and determine it by local government possibly by location within even local governments So it's a ridiculous suggestion I believe like I started with that intentions are good but we need to look at all that kind of intervention that is possible And that can help us in the situation in which we have found ourselves In the situation in which dollar prices, the exchange rate is very volatile It means that at every instance that these fluctuations are happening you also need to recalibrate those prices This is a country that is heavily dependent on imports So as you are importing and dollar exchange rate is changing, your cost profile is changing And government must continue to recalibrate to ensure that we can have those prices It is absolutely unrealistic Absolutely I remember at the time of Buhari's first coming we had this price control And the army people would enter the market and then things were sold at ridiculously low prices and all that And I was just looking at this judgment and saying are we going back there But we have the price control board in the face of this hardship Nigeria is facing What role can this price control board play without necessarily infringing on the rights of people and making the businesses of people go down the way it should not go down So what kind of role can the price control board play at this juncture to make Nigerians lives better I will say maybe their role should be restricted to issues around fleecing They could look for those circumstances that appear The business people are fleecing or necessarily taking advantage of the people in the way the prices are good And they can intervene But you see a very beautiful intervention in the prolonged situation like this is in the agriculture space Now when farmers have produced this is what happens most of the times in harvest season So you see a product in very massive quantities and the prices very cheap In those instances let's use grain as an example An intervention could be that when those products are out and are very cheap Corn for example with this maize could be as low as 100,000 euro per ton when it is in those kind of seasons Now farmers could even take losses in those seasons because there is a gloss So government can step into that space and buy and begin to buy When it is buying it will have to show up the prices to a certain extent that the farmer can make profit And it's delighted to go back to the farm and farm again Now when the product becomes scarce like you see maize has become very expensive By the time it's getting to March, April, May it's almost unaffordable The government will go into its silos and release some of these maize that it has bought in September when it was cheap And it will release it to bring down the prices onto a certain particular pedestal When these grains are released who will they be released to? Because how are you putting it into the market? Yes I'm not talking of the kind of release that we have now This one is a palliative kind of release that is free I'm talking of an intervention in which those maize they will be bought in the first instance When they are extremely cheap and you want the price to come up a little bit so that farmers can make profit And they will be delighted to go back to the farm and farm again And when the prices become so exorbitant that consumers are suffering Then you begin to sell into the market What you are essentially doing is you are increasing the supply in the market And you will automatically have a price effect on those items And the price will go down because you are flooding the market until you achieve a particular price level that you believe is the target that you are going to So these are the kind of intervention that we can look at not the fixing of prices for everybody I just ask this because government doesn't have a shop or something So are they still going to give to their political cronies? Those people that they gave palliatives to take to the market How is this going to flood the market such that the price comes down? Who will take it to the market? Will it be the governors that will be given to give to the people free of charge? Or how will it get to the market? Government doesn't own a shop Well as far as palliatives is concerned Which I mean it doesn't follow the normal economic rules Of course you have to give it to the governors And at the level of the governors you have to not have structures with which you can get this across to the people The interesting thing is if we are serious If the motive is altruistic If we really want to do this we can do it because there are structures There are structures around the local government There are structures that ride on the back of religious organizations Who are by the way already involving one form or the other in distributing palliatives So if we are serious the truth is that we can get it down to the people who need it Well you and I know how some of these things work out People who don't need it will corner these things and they will Thanks to the people who really need it If we are able to get into funny markets and some people will start to sell it It is part of what we have seen in this country But it is not because it is impossible It is just because our people I don't want to impose our people but what we have seen We know what you are struggling to say Leave it there, we understand But you said interventions and you have mentioned quite a few But we would just like to know these alternative interventions That can be done instead of this price control That is being muted right now Okay, we need to intervene in certain critical areas If you look apart from Phil If you look at the majority of the other goods that were mentioned in that judgment There were things that we eat So it has been said over and over again I am delighted that government is also now beginning to sing the same song Hopefully we will take it beyond song and make it into reality And that is the fact that food inflation is a major component of our Composite inflation figure If we solve food problems Right now that inflation is about 28 points something or let's say 29 Food inflation alone is over 30 So that shows that it is a critical driver of the cost of living in the society If we can do something about food Then we will have to moderate the inflation The general inflation figure in the economy So what are those things that will help us deal with insecurity matters There are very huge agricultural states in Nigeria today They are insecurity of chase people away from the farm Kaduna, Plateau, Beirut All those states that I mentioned They are heavy farming societies Heavy in agrarian economy But then a lot of things are affecting them So they are able to produce that We also have issues around connecting Centers of production with the markets The infrastructure that does this we should pay attention to it We've been talking since July about putting an additional 500,000 hectares Of arable land into agriculture If we don't it How many of these 500,000 hectares if we put into agriculture If in that July that the president made that speech If May is a center ground or cowpea or whatever We would have had maybe even two seasons of some of this product It would have been in the market So taking those things You see we are good at analyzing Nigeria's problem And most of these problems we know them But to take this specific action And move away from just the analysis into the doing The place of doing is where we have a problem 500,000, if it is 1,000, 100,000 hectares Now we've been able to put into cultivation Since that speech was made It would have been still, I started to make a difference today So action is the real thing We know the problem Hello Hello Can you hear me? Okay we can hear you now Okay Okay so I mean we've heard all of the initiatives That you've said But my question now is How do we move forward? Because fine we can have all of these ideas Well what are like the first few steps That the government can start to put in place Because like we say Nigerians are really suffering And you have also pointed out the fact that Food inflation is actually about 33% With the general inflation rate about I think 28.92 So what are the practical steps that we can start to take now And can people help the government Because at this point it seems like the government The government has that tied And there's so much they can do And maybe they are not able to pull their weight Based on certain setbacks And you know But let's just hear your thoughts What can we do To help the government and what are the first few steps We can take for us to I mean see the prices become fair Okay of course some of the things we can do In the immediate Will be to deploy these palliatives Effectively Do you think that will be done? Do you think that will be done? Do you think that will be done? Let me go back to part of what you said Part of what you said is that The people should also help Who are the people that are cornering this I've never seen a governor sharing bags of rice by himself So we give it to our people to help to deploy these things And in the process of all of that We start to see all sort of stealing And you know denying the real people Who need this thing from getting there Within this country's situation And with politicians that have put in their own name And wanted to use the palliative For their own birthday as a gift You know these are the kind of things That make all these palliative ineffective Government as you said will release So maybe eventually there will be a release By the time you now see deployment of what has been released You start seeing the situation in which An entire family is being given Two Derikas of a carry People like this might not even get any Some might not even get any But if only we have done it the right way It will get to the real people who need it the most And they will get something that will Pushing the immediate pains that they are feeling Now beyond the immediate which is just palliative We now need to think of what we will do For the medium term What will help us to sustain things I believe we are working very hard At the issue of exchange rates When the country is at the junction Where it doesn't even have 2.4 Or 2.2 billion dollars to pay the Outstanding obligations around the CBN windows So it shows how critical the issues are But like the CBN governor said We are putting our steps in the right direction And hopefully we will begin to see Certain results from that And why is that important Because we are still a heavily dependent Economic A lot of things that we consume in Nigeria Are still important So we need to deal with that because of The exchange rates Now we need to produce insight A lot of things I saw the other time I saw The bread debaters were protesting And it was maybe play two or something I'm saying look In play two we can plant wheat But we are not planting wheat We are protesting that the price of wheat has increased The price is not our product now We are bringing it in If your dollar exchange rate has gone south Your naira has gone south Obviously the price will go up It is not within the control of The market forces will determine that So can we begin to produce more There are a lot of things we have been blessed with We have arable land, we have water And we can put it to use meanwhile We are busy importing food from countries Who do not have 10% of what we have Let's make better use of what we have And we can do this over a medium term Come to think of it 500,000 hectares of land 500,000 if it is maize 500,000 hectares in two It will show up somewhere along the line Let's come into the space of doing And move away from the talking Alright, I love that I think that is a very good way to land it Let's come away from the space of talking Let's start doing what is necessary Anyways, I want to say thank you for coming here And sharing insights on this topic Thank you Thanks for having me Thank you so much Alright, so we are speaking to Bola-Hon or Lo-Jede He is a public affairs analyst And we have been talking about how Well, they have told the federal government That they need to fix the prices Which some people say it is not very practical But we will see We will go on a short break When we return we will be looking at our next hot topic So please stay with us