“If not for her, I would have left this country,” Moses Chukwudi, a foodstuff trader at Mile 12 Market, Lagos, says of his new marital status as he discusses the economic downturn in Nigeria. Chukwudi got married in November 2016 and planned to lavish his income – made from selling rice, beans, garri, palm oil, vegetable oil – on his bride, but in just two months, he wished he held back on that plan. He is not making money anymore. He said his business had deteriorated so much that he could have left the country if he were not married to the love of his life. “Just last year, we bought a bag of garri for N6,000, today (January 12, 2017), the same bag goes for 10,000. I usually stock my store with 50 to 70 bags of garri, and sell about 20 bags in one day,” he told TheCable. “Look at this one,” he points to a sparsely stocked storehouse, “I bought 18 bags on Sunday, and today (Thursday), most of them are still there. Before, I would have sold all in a day.” Living standards, according to the World Bank, are measured by income and expenditure. In Nigeria’s case, real income has dropped over the past 12 months with the massive fall in the value of the naira and rising unemployment. With prices of goods and services taking a flight, the standard of living for Nigerians has evidently dropped. TheCable reviewed the prices of goods and services across the six geopolitical zones, and the conclusion in every nook and cranny is the same: cost of living is reaching for the skies.When asked why the price of garri, which is made in Nigeria, had gone up, he said it was due to the rise in the price of palm oil, which is used in fortifying “Benin garri”. In the first Cost of Living in Nigeria survey done in mid-January 2017 by TheCable, there are strong indications that more Nigerians are living in poverty today just 12 months ago. One factor is that the United Nations reviewed the poverty line from $1.25 per day to $1.90 per day, and this is worsened by the rising cost of living and declining purchasing power in Africa’s biggest economy. Standard of living is the quality of life being lived by a particular set of people — their level of wealth, comfort, material good and access to the basic necessities of life.
FROM INSURGENCY TO INSOLVENCYAnthony Shekara, a resident of Adamawa state, highlights the decline in living standards in the northeast, despite the state’s crippling recovery from the jaws of insurgency. “From last year, the prices of goods in the market have been rising at an alarming rate, with no commensurate cash in the hands of consumers to purchase them,” he says. “Life has been, to say the least, very hard and unbearable for consumers in Adamawa state.” While battling the humanitarian crisis wreaked by Boko Haram in Maiduguri, the capital of Borno state, residents, also have to wield their finances against rising food prices in the region. “It’s worrisome,” Abuy Abba Akhuwa, a resident who gave TheCable details of the price crisis in Borno, laments. “Considering the current critical economic situation in the north-east, it is very disturbing. I’m urging the federal govt to please come to the aid of the citizens by at least implementing commodity price control or regulation.”
MEAT, FISH DISAPPEARING FROM DINING TABLESIn Akwa Ibom, it has become increasingly difficult for corps members to continue to feed on the kind of diet maintained in the earlier parts of 2016. With the rise in prices of basic staples, meats and fish are gradually disappearing from their tables. Akor Ruth, a corps member in the state, says her colleagues, who live together in Christian-run family house, have had to review their monthly payments for food. The corps members, who have a “common pot”, usually contribute N5,000 per month to buy food items for the month. But that has since changed. “We had to increase monthly payment from N5,000 to N6,000, yet we have had to slash some things we put in our food. We don’t eat meat again, we don’t eat fish again, its only egg, and that is like once or twice a week. On other days, we eat ‘empty’ food,” she discloses.
THINGS FALL APART; ABUJA CANNOT HOLD“Things fall apart; the centre cannot hold,” William Butler wrote in his 1919 poem of the first world war, with no thoughts of Abuja, the geographical centre of Nigeria and the capital of the nation, where living standards are equally falling apart. ”Things are so expensive now that the food stuffs I used to get for my family I cannot get most of them now. I spend same amount to get barely half of what I do get for a month supply now,” Nkemdirim Richards, says with a mix of hope and frustration. “This recession is biting hard on us. Can you imagine a bowl of garri is now N350? Buhari should help us before we wont be able to afford to feed ourselves anymore in Nigeria.” “I don’t even know what to say to the prices of foodstuff now. We can’t afford ordinary garri again. A bag of rice is almost N20,000! That’s the amount my family’s budget for a month on foodstuff,” Raheemat Balogun, tells TheCable at Utako Market, Abuja.
ELECTRICITY IS TAKING POWER AWAYBabatunde Fashola, minister of power, works and housing, said early in 2016 that the hike in electricity tariff is a painful pill Nigeria must swallow for better electricity in Africa’s most populous nation. The pill, however, has not only been painful, but also shrinking the purchasing power of many Nigerians, by biting hard into their disposable income. In Lagos state, a single self-contained room tenant, who paid N1,200 per month in January 2016, has to pay as much as N3,000 for the slightly improved power 12 months later. In context, a Nigerian who lives in this self-contained room should pay N14,400 in 12 months, but will now pay N36,000 for electricity within the same time. In Kogi state, a residential flat, which went for N5,000 per month in the earlier parts of 2016, now goes as high as N9,000. Residential areas in Jos paid N16.75 per kilowatt of power in January 2016, but now pay as much as N26.97 for the same in 2017. The trend is identical across the nation.
GAS EVERYWHERE — BUT YOU CAN’T TOUCH IT“Before they knew it, it was climbing higher. Shipments for import were also not allowed to come in, so distributors were holding on to what they had bought earlier. “In fact, throughout last week, we couldn’t get 12.5kg gas and it went as high as N6,000.” Over the past month, the price of cooking gas across the nation has risen drastically. The prices soared by over 30 percent in Nigeria’s commercial capital, Lagos. Emmanuel Adegoke, a cooking gas dealer, tells TheCable that it had become increasingly difficult for him and his colleagues to get gas. “We were told that the gas came in very expensive from the source. It is being imported into the country. As at December 27, 2016, what they were buying at N4.4 million before Christmas, they bought at N6 million.
FOREX POLICY AND DAMNING CONSEQUENCESGodwin Emefiele, governor of the CBN, made a joke at the Annual Bankers Dinner for 2016 about a woman who added too much salt to a dish she made for her husband’s visitors. When the woman was asked why the food had too much salt, she said: “Sorry my husband, it is because of the CBN policy on the exchange rate!” Emefiele said everyone blames the CBN for every problem in the country today, including the ones the bank knows nothing about. But Emeka Osondu, a trader, believes the foreign exchange challenge affected everything in the economy negatively. “Kings five litre oil has gone from N2,500 to N3,600, and this is because of the foreign exchange rate, and the cost of transportation,” he said. “Everything has gone bad.” As far as he is concerned, the exchange rate is determined by CBN policies.
MERRY CHRISTMAS AND MERRY NEW YEARUp until 2016, Janet Yakubu, who sells spices and condiments in Bauchi, always had a merry Christmas and a happy new. Her children always celebrated the Christmas with “merry” new clothes, and the new year with “happy” new clothes – one new cloth for every festivity. This time. however, the economy beats her to the tradition. “My children had to manage one new cloth for both Christmas and the new year,” she said, adding that her profit from spice sales has been battered. Fewer Nigerians want these spices in their lives. Usman Inuwa, also resident in Bauchi, says it has become difficult as a father and a husband to meet the bills. “Things are very, very expensive. This year, in particular, prices that were high before have gone further up. Everything has increased except pure (sachet) water,” he says. “In fact, the market that I do go is where things are a bit cheaper, yet it still seems expensive”.
TOMATOES ARE A BRIGHT SPOTThough prices have been on the rise across the country, the case of tomatoes is a bright spot to the gloomy picture. Earlier in 2016 a basket of tomato went as high as N40,000 owing to “tomato ebola” which affected the crop across the nation. However, the prices have been on a decline for a while, and was selling for N6,000 per basket at the Mile 12 perishable market in Lagos as at January 15, 2017.
HOW POLICIES PUSHED MILLIONS INTO POVERTYIn 2016, the Nigerian government embarked on a series of reforms aimed at making the economy more productive, following a crash in the prices of crude oil, the government’s major source of income. The crash in oil prices slashed government earnings by over 50 percent, leading Nigeria to “desperate measures in desperate times”. The first of all was the rise in electricity tariff across the nation. The government followed up with a spike in the price of petrol from N87 per litre to N145 per litre. Mid-way 2016, the CBN allowed the naira to “free float” effectively devaluing the local currency from N197 per dollar to N305/$1. The International Monetary Fund (IMF) posits that Nigeria’s crisis is not just because of a crash in oil prices, but also because of the delayed and poorly managed policy adjustment to the country’s fresh realities. The fund said “inflation has risen to troubling levels” owing to delayed adjustments and the country’s foreign exchange policy. “Domestic policy failures cited include delayed/poorly managed policy adjustment to lower commodity prices — as in Nigeria, where foreign exchange rationing adversely affected debt service capacity of many corporates,” IMF said. With the United Nation’s poverty line revised in October 2015 from $1.25 (N246) a day to $1.90 (N374) a day, this singular policy – naira free float – raised the country’s poverty line from N374 a day as at January 2016, to N580 a day, at the end of the year, pushing millions into poverty. Hike in import duty, review of fuel prices, increase in electricity tariff, devaluation of the naira, all culminated in higher commodity prices across the country, raising inflation rate from 9.6 percent in January 2016 to 18.55 percent at the end of the year, according to the National Bureau of Statistics (NBS). These government policies directly lowered living standards among Nigerians, whose disposable income were not adjusted upwards, throughout the year under review. Chukwudi loves his wife even if he cannot demonstrate it by showering gifts on her. It is the economy, stupid!