When President Muhammadu Buhari took office on May 29, 2015 with a promise to eliminate corruption that had flourished under previous governments, attain food security, and support the poor and vulnerable in the society, Nigerians were hopeful of a better life under his administration.
He also promised to reform an economy hooked on petrodollars, reduce poverty and create jobs.
Today, numbers show that the country’s economic conditions have worsened, leaving many Nigerians poorer.
The prices of food items as well as costs of transportation and energy, especially diesel, have surged, compared to what they were seven years ago.
The average prices of key staples across major cities in the country have jumped by over 2,000 percent since 2015, causing inflation to hit 17.71 percent in May 2022.
Inflation in Africa’s biggest economy has remained double-digit yearly since it recorded a single digit in 2015, wiping out a large portion of Nigeria’s middle class, according to SB Morgen Intelligence.
Mckinsey had, in a 2013, spoken glowingly of an emerging retail economy in Nigeria in a report titled ‘Africa’s growing giant: Nigeria’s new retail economy.’
Currently, Nigeria’s middle class is fast shrinking as inflation continues to erode consumers’ purchasing power and inhibits discretionary spending, thus changing shopping habits of many Nigerians.
For lower-income households with little or no cash cushion, they are making harder choices such as what to buy or not, experts said.
Despite the Nigerian economy growing by 3.11 percent year-on-year in real terms in the first quarter of 2022, 105 million Nigerians still live in extreme poverty, according to data from the World Poverty Clock of the Brookings Institute.
Recently, the World Bank projected that the country’s accelerating inflation will push 7 million Nigerians into poverty by the end of 2022, owing to the rise in prices, particularly food prices.
When Buhari came into power in the second quarter of 2015, the country’s unemployment rate was at a single digit of 8.2 percent, according to data from the National Bureau of Statistics (NBS).
It surged to 33 percent in the fourth quarter of 2020. Unemployment numbers have not been released since then.
“With this recent increase in our rent and continuous rise in the prices of everything, things are getting difficult for us,” said Yemisi Adegoroye, a teacher and a mother of two. “The worst of it all is that our income has remained the same despite paying for more of everything you need.”
The situation is worse for most Nigerians living from hand to mouth, which means they spend virtually everything they earn to sustain themselves daily, and there’s little or no spare cash to tuck away in a savings account.
What’s worse is that some Nigerians are facing their inflation struggles without jobs.
Lamidi Habeeb, who was laid off from his poultry work in December 2021, after his employers shut down their poultry farm, has struggled on all fronts since then, whether to feed his family or for daily expenses
“My priority is ensuring we eat and the rising cost of everything is driving me crazy,” he said.
Read also: Insecurity driving Nigeria’s inflation, than by Ukrainian crisis
BusinessDay analysis of items in the basket that determine inflation, using the selected food prices report by NBS, shows that a litre of petrol, which was sold for an average of N65, now sells for N173 per litre. A 12.5kg of gas sold for N3,000 in 2015 now sells for N8,726.
Similarly, a litre of vegetable oil sold 250 in 2015 now sells for N996. A slice of bread sold for N300 in 2015 now sells for N456. A dozen of eggs sold for 320 in 2015 now sell for N689.
A report by SB Morgen on ‘Nigeria’s History of Inflation: A Tale of the Destruction of Value’, identified the 2019 border closure policy, high import tariffs, petrol subsidy, and the current exchange rate regime of the Central Bank of Nigeria as major factors fuelling a surge in prices of various items and commodities under the Buhari administration.
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