I live in a country where it's economy has gone through very challenging times over the past year. In Nigeria , Inflation reached 28.92% in December 2023, the highest in 27 years. Food inflation rose to 33.93% in December 2023.
One can't help but notice how the naira depreciated significantly, losing 25% of value in a single day in June 2023. The government uninanimously decided to remove the pegging to the US dollar. This of course made imports much more expensive.
As if that wasn't enough , the removal of fuel subsidies by the new president in May 2023 caused petrol prices to jump by 196% practically overnight, from ₦189 to ₦557 per litre. Prices went through the roof consequently as fuel price currently sits at ₦630 ($1.8) per litre .
According to the World Bank, accelerating inflation pushed an additional 24 million Nigerians into poverty in the first five months of 2023. By late 2022, 63% of Nigerians (133 million people) were considered abjectly poor.
Currently , major foreign companies like Procter & Gamble, GSK, and co were left with no other option than to stop manufacturing and scaled back operations in Nigeria, due to harsh economic operating environment. This resulted in massive job losses, you can imagine for a country where unemployment is the order of the day . It does really speak volumes of how bad the Nigerian economy is .
These days you can't go to the market to buy foodstuff and come home smiling. Purchasing power for most individuals is on the all time low as prices of most commodities aren't bearable and friendly to the pocket at all . You ask the market vendor why her tomatoes and peppers are expensive? She tells you it's because of the increase in the price of the dollar , Lol! . They all use the Dollar appreciating against the Naira as a flimsy excuse.
Fast forward to these recent weeks a Dollar is now at ₦1,172 but prices of goods are still up, things are still very much expensive. As much as the government is bad, we the people aren’t different, we are even worse than the government.
Nigerian traders are the first to know when the dollar is rising, but the last to know when it is falling. They all claim they bought their stocks when a dollar was #1800 and now that the Naira has appreciated against the dollar they have to sell those goods off at expensive prices before prices of goods and commodities starts to reduce. You honestly can't fault them as the government itself doesn't have a regulatory price board that will be responsible for the regulation of prices of goods and commodities.
Citizens are painstakingly clamoring for the reduction in the cost of food prices . However I don’t see this coming into fruition if the price of fuel and diesel doesn't reduce . The removal of fuel subsidy last year May heralded the different hike in prices of different commodities across the country. Take foodstuff for example , most of the heavy duty trucks transporting raw foodstuff to market vendors and retailers majorly use diesel . The price of diesel is really on the high as it is currently #1350 ($1.15) . As a result of this most market vendors have no choice than to buy at a high price. No one wants to go into a business and run at a loss , so we the end users (consumers) will be the ones suffering for it as we have no choice than to buy these goods at high prices and the cycle continues .
At this juncture one just wonders if there's a really a way forward. Nigeria's economy does not have a middle class. You're either rich or poor. People don't even realize how poor we are. Basic things of life are seen as a luxury in this country and it's quite funny if you ask me . Even recently electricity tariffs went up , for a country that doesn't have constant electricity appalling you will say .
Nigeria’s journey towards a more inclusive and prosperous economy will be accelerated by the adoption of technological innovation in all sectors of our economy. The earlier the government actively keys into this the better.
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