Each time I enter a gas station for fuel , I get very sad. I begin to wonder why I should buy a litre of fuel for N950 , about 250% the cost some eight months ago! My sadness assumed higher grounds when I remember that a N20,000 fuel would only take me to Ikeja from Airport road and back, about 30 kilometers distance. This implies that the cost makes nonesense of any wage increase in Nigeria because the major denominator of costs has become out of reach and that pushes up the cost of every activity, from transportation to ordinary water. This becomes so difficult in an economy that has not structured social benefits and economic patronage in its development plans.
Many have wondered where the Federal Competition and Consumer Protection Commission will begin to find the locus of real cost of services and commodities in Nigerian markets and institutions. The history of consumer price regulation in Nigeria provides an inefficient and ineffective measurement strategem which do not provide the real value and costs of commodities in the country. With an admixture of price and cost determinants in the country, institutions like FCCPC in the past had failed to produce useful results. One may find it difficult to indicate where the causatives of price hikes start and where they end; is it the rigmaroling fuel cost, which increases transportation and delivery costs or the ravaging forex situation? These are obviously the unavoidable variables, but one is more negatively impactful than the other.
What Nigerian may be told is the fact that, the administrators of the FCCPC project may concentrate on the end price of products and services without looking at the backgrounds of the costs which will not be market place situations. This will end up causing woeful impacts to traders who have been forced to swallow the initial costs. For instance, a dutiful FCCPC must not go to unleash mayhem on the Mile 12 market, centre of primary food products, without controlling the way transportation has impacted them. This becomes so important because the members of the FCCPC management seem to be on unwarranted pressure to produce result, without a proper study of the entire price and cost episode. Last week, the DG of the Organisation, Tunji Bello, was heard discussing his disgust over price instability after a visit to two prominent Super Markets in the country. His narrative could be the real situation in the country, but those malls were simply responding to price movement situations. I hope Bello and his team will nod wholly depend on such comparisons to justify the issue of consumer price index, but must look into the stronger capital consequences that influence final cost mechanisms.
It will not be fair if FCCPC enters the market to start behaving like a Price Control Board when the real rhino is behind the market shops. This emphasis has to be emphasised based on the fact that the organisation may descend on traders in the market while the larger organisations have already passed the costs which the traders must accept.
I strictly believe that FCCPC is a booby-trap which is coming at the wrong time, as manufacturers, importers and regulators are battling with price mechanisms that are out of their control. If the organisation begins to torment market traders as the starting point the effort ùwould look like an idea directed against the masses in the market and the reaction will only create artificial scarcity which will increase the price, because traders and dealers must discover way of avoiding the operators. Market raids have never slowed down prices of goods. They must intend to be comprehensively proactive instead of reactionary.
Since there would be some obvious conflict of interest and function between the FCCPC and other institutions , clear lines must be drawn in the cases of dealers managed by government institutions where the FCCPC must have an over-site function.
The appointment of Bello easily fits into the sequence from where the situation could be addressed, there must be the clear statement on punishment and resolution for it to be able to punish offenders and educate the ignorant.
They have to star from the contracts and supply to government institutions so that the issue of corruption would begin to decline.
I wish Bello and his team luck, and the knowledge to weather the cravices of price manipulation.
