Nigeria’s COVID-19 curve is currently flattening rapidly, but the share of households whose safety nets are being threatened by economic shocks continues to ascend.
Statistics from the Nigerian Centre for Disease Control (NCDC) on August 30 showed that the number of daily confirmed COVID-19 cases was 138 persons, the lowest daily report recorded since April 27.
Nonetheless, the hardship being faced by Nigerians as a result of COVID-19 continues to exacerbate.
Increases in the prices of major food items consumed and farming/business inputs continues to be the most widely experienced shocks in the country, according to third round of the Nigeria COVID-19 National Longitudinal Phone Survey by the National Bureau of Statistics (NBS).
On its own, the increased prices of major food items have affected about 90 percent of households while increases in prices of farming/business inputs affected 64 percent of households.
Interestingly, the Nigerian COVID-19 curve started to flatten from the end of July as daily confirmed cases started dropping, according to an analysis carried out using data from the NCDC.
The same can however not be said about the number of job losses, the percentage of households reducing their consumption as well as the constraints on the ability of households to meet their basic needs.
NBS report on the third round of the Nigeria COVID-19 National Longitudinal Phone Survey reveals a 27 percent increase in the number of households that have had to reduce their consumption as this rate moved to 69 percent by the end of July from 54 percent at the end of May.
Also, the percentage of households relying solely on their savings experienced a 6.8 percent increase to 31 percent, from 29 percent between mid-march to April and May.
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“The projected rebound of the Nigerian economy by 2023 which contracted by 6.1 percent in the second quarter of 2020 will not necessarily reflect on different units of the economy”, said Boboye Olaolu, Sub-Saharan African economist at CSL Stockbrokers.
“As long as total population growth is higher than GDP growth, the economic recovery will not translate to an increase in living standards as wealth is not adequately transferred”, he said
The access of households relying on farm business to inputs for crop production has also been hampered by the pandemic.
72 percent of farming households that needed inorganic fertilizer and 47 percent of farming households that needed pesticide/herbicides were not able to access them, according to the round three COVID-19 impact monitor.
Additionally, the share of households unable to purchase some staple foods remained high in July: 62 percent of households who needed yams were unable to purchase them, while 37 percent of households who needed rice were unable to purchase it.
Lack of money and an increase in prices were the predominant reasons why households were not able to purchase these staples, indicating the continued economic impacts of the COVID-19 crisis, according to the COVID-19 impact monitoring report.
More Nigerians are going back to their jobs, but persons in rural areas have experienced a higher job recovery than those in urban areas.
This could be due to the relocation of Nigerians from the cities to rural areas to reduce their cost of living and find alternative job sources.
The above statement corroborates the comment made by David Cowan, Chief Economist for Africa at Citibank, during the virtual luncheon in honour of Jesmin Rahman of IMF, hosted by American Business Council…that ‘Nigerians have a natural coping mechanism as the informal sector acts as a natural safety net’.
“The Nigerian government is making efforts to improve jobs as we can see from the N-power project as well as the Special Public Works programme (SPWP). But there is a need government to bring efficiency into the public sector”, Olaolu said.
“if the money the public sector makes can cover their expenses it will reduce the amount of money that government spends on them and create more funds for government to create more jobs”.
“Government policies are most times too ambitious, if they can be fairer in their planning and use more realistic benchmarks, there would be hope for achieving sustainable development by 2030”.
Pre-COVID-19, United Nations (UN) predicted that by 2030, the number of undernourished persons in the world will stand at 841 million, this number has however been revised upwards to 909 million as a result of the pandemic.
Nigeria has over 83.1 million of its total population as poor persons according to the last released report on poverty in May 2020 by NBS.
This number already represents about 10 percent of the total undernourished persons projection for 2030 by UN.
“Maintaining price stability and improving the business environment to bring in more private businesses are two important factors for improving living standards in Nigeria”, according to Yinka Ademuwagun, Research Analyst at United Capital.
“The president of Nigeria has a plan to lift millions of Nigerians out of poverty over the next three years, but the question we should be asking is, can inflation be reduced to a single digit in three years’ time?”
“Pre COVID-19, Nigeria was already faced with so many structural issues like multiple exchange rates, supply chain issues, oil dependence, logistics and transportation issues, amongst others”, mentioned Yinka.
“To end poverty and hunger and in Nigeria according to goal one and two of the Sustainable Development Goals (SDGs), a collective action is needed from the public and private sectors as the public sector alone cannot solve the problem”.
“Especially on the regulation role of the government, government needs to continue in the pattern of the just released Companies and Matters Allied Act (CAMA) to aid and smoothen the business environment for private investors”.
Also, if we remain reliant on the western economy, we would keep importing inflation and other volatilities to our economy, which is bad, Yinka said.
“spurring growth should be followed by a reduction in cost for doing business and maintenance of price stability which will then translate to an improved standard of living for Nigerians”.
