Modern Retail Can Reduce Inflation and Boost Government Revenue – Sun-Basorun

The Nigerian modern retail sector can become a major catalyst for economic growth by reducing inflation and boosting government revenue.
This was the crux of conversations by Ade Sun-Basorun, Chief Executive Officer of FoodCo Nigeria, a top 5 retailer, who spoke against the background of the May National Bureau of Statistics figures that put the national inflation rate at 22.97%.

According to Sun-Basorun, if properly harnessed, the modern retail sector has the potential to create jobs at scale, mitigate inflation and unlock significant tax revenue for government. This will consequently unlock economic activity at the macro level and trigger complementary development across industry.

He said: “One of the reasons why modern retail leaders such as FoodCo have continued to advocate for robust support for the sector is based on the knowledge that a well-structured retail economy can drive stability in the larger economy as well as lay the foundations for inclusive growth.

“For example, in informal trade, prices are often rounded up due to the limitations of cash-based transactions. However, modern retail makes use of digital payment systems that enable exact pricing. When applied across millions of daily purchases, this could help drive meaningful savings for households and ease overall inflation.

“Presently, the government’s efforts at promoting stability in the forex market and driving digitalization are welcome incentives with potential to boost the prospects of the sector significantly. We trust that these will be supported by providing a robust infrastructure to facilitate concessionary financing for retail operators, establishing one-stop regulatory desks to ease the logistical challenges around business registration and expansion, and offering tax incentives to encourage local sourcing, especially from rural farmers.”

He continued: “Retail is a big driver of the economy of many countries. If provided with the necessary support, modern retail can become a major stimulus for economic growth in Nigeria. A strong modern retail sector will translate into more jobs for citizens, lower prices of consumer goods, better income for small businesses along the value-chain, and more tax revenue for the government that can go into building roads, schools, and hospitals.”

FoodCo is a diversified consumer goods company with interests in retail, quick service restaurants, manufacturing and entertainment. The company operates the largest supermarket chain brand in south-west Nigeria and has been listed in the Financial Times list of Africa’s Fastest Growing Companies for 2021, 2022 and 2024.