CEM REPORT, FOOD | Food prices are skyrocketing across Sub-Saharan Africa (SSA), with several countries experiencing double-digit inflation, according to a new report by the World Bank. This is putting a severe strain on household budgets, particularly for the most vulnerable populations.
The latest Africa Pulse report, a biannual analysis of African economies, paints a concerning picture. “By February 2024,” the report states, “about one-third of Sub-Saharan African countries with available data (14 out of 40) had double-digit year-on-year food inflation rates.”
Nigeria Makes the List
Five countries – Nigeria, Ethiopia, Malawi, Sierra Leone, and Zimbabwe – were identified as having the fastest rises in food prices. This trend is attributed to a combination of factors, including:
Weakening domestic currencies: A decline in the value of local currencies makes imports, including food, more expensive.
Disruptions to food supply chains: The lingering effects of the pandemic and ongoing conflicts in some regions are hindering agricultural production and distribution.
Climate shocks: Droughts and floods are impacting harvests and driving up food prices.
Nigeria’s Double Digit Inflation and Increased Food Prices
Nigeria, Africa’s most populous nation, is a prime example of the challenges faced by many SSA countries. The National Bureau of Statistics (NBS) reported that Nigeria’s inflation rate reached a staggering 31.70% in February 2024, a 14-month consecutive rise. Food inflation, a crucial component of the overall inflation rate, surged to 37.91%.
“The rising food prices are largely due to recent government reforms, including the removal of petrol subsidies and naira devaluation,” explains Anika Patel, a food security expert based in Lagos. “These measures, while aimed at long-term economic benefits, have had a short-term impact on affordability.”
The World Bank’s Nigeria Development Update report estimates that these factors, coupled with sluggish economic growth (2.74% in 2023), have pushed an additional 14.2 million Nigerians into poverty in the past year.
Hopefully Yet Challenges Remain
The World Bank’s report offers a glimmer of hope, projecting a gradual decline in inflation for the region. “Average inflation is expected to fall to 24.8% in 2024 and further down to 15.1% by 2026,” the report states. This is partly attributed to anticipated monetary policy tightening and exchange rate stabilization efforts.
However, significant challenges remain. The report warns that debt distress remains a major concern for many SSA countries, with over half facing unsustainable debt burdens. Additionally, the pace of economic growth is insufficient to significantly reduce poverty.
Looking Ahead
The World Bank emphasizes the need for African governments to address structural inequality to achieve sustainable and inclusive growth. This requires a multi-pronged approach, including:
Macroeconomic stability: Implementing sound fiscal and monetary policies to control inflation and promote investment.
Promoting social mobility: Investing in education and healthcare to create opportunities for all.
Supporting market access: Facilitating access to markets for smallholder farmers and entrepreneurs.
Equitable fiscal policies: Ensuring that tax and spending policies do not disproportionately burden the poor.
The report also calls upon the international community to support African nations in their reform efforts through concessional financing and debt management assistance. By working together, African governments and the international community can create a more stable and equitable future for the continent.