Mohammed Idris, 35, worked as a driver with one of the interstate transport companies in Lagos, Nigeria’s commercial capital, until the lull in business occasioned by the COVID-19 lockdown in Lagos, Abuja and Ogun State forced him out of job in April. He is now jobless and hopeless.
Idris, who came to Lagos in search of greener pastures from his hometown in Jigawa State, north-west Nigeria, lost his means of livelihood after President Muhammadu Buhari on March 29 announced a 14-day lockdown, which later extended to five weeks, in the three key economic centres of the country to contain the spread of coronavirus. A major component of the lockdown was a ban on interstate travel.
“I came to Lagos to live a better life and send money to my parents, but now daily feeding is a big challenge,” he said.
The situation would have been different for Idris if the palliatives promised by the federal and Lagos State governments had reached him, but he has not received any.
“I have not seen any palliatives from anybody or any government official,” he told BusinessDay.
For Idris and millions of other Nigerians, including those in the middle class who are at the risk of losing their jobs as a result of the COVID-19 impact, years of GDP growth lower than population growth rate have left them poorer per capita. The inability of the government to provide them with palliatives at this critical time has worsened their woes.
The Nigerian government has only provided cash relief to 3.6 million poor households during the lockdown, a tiny figure in a country where 95.9 million people live in extreme poverty. Having surpassed India as the country with the most extreme poor people in the world in 2018, Nigeria now also ranks among the 16 countries globally where extreme poverty rates are still rising.
Godwin Emefiele, Central Bank of Nigeria (CBN) governor, recently unveiled post-COVID-19 policy priorities, targeting sectors that can generate mass employment and wealth creation, including light manufacturing, affordable housing, renewable energy and cutting-edge research.
The CBN has also set up a N50bn fund that SMEs can apply to for loans and advised banks to provide forbearance to customers.
“The government’s inability to cater for its poor reflects a long-running lack of a functioning, nationwide social welfare system,” Dolapo Adeyeye, an economist with Lagos-based Creditville Limited, said.
Nigeria’s economy is on its knees amid collapsed oil prices and a ravaging pandemic. Excess Crude Account, Nigeria’s ‘rainy-day fund’, has dwindled to an all-time low of just $72 million.
Lower remittances from Nigeria’s hardworking diaspora are another warning. These typically account for 6 percent of GDP but dropped by half in February as the world’s major economies entered lockdown.
Also, fiscal challenges facing Nigeria’s 36 states are even starker. Kayode Fayemi, Ekiti State governor and chairman of the Governors’ Forum, admitted states may get zero allocations from Federation Accounts Allocation and Fiscal Commission (FAAC) in June owing to the drastic fall in the prices of crude oil.
As the economy continues to falter, there is justifiable fear that more families will continue to fall into poverty, and remain trapped in it, perhaps for more generations, perpetuating a vicious cycle of poverty.
But while Nigeria finds it impossible to reach its vulnerable folks, some of the world’s largest nations have kicked off plans to keep citizens afloat in these unpredictable times.
Indian Prime Minister Narendra Modi announced a massive package of more than $265 billion to revive an economy battered by a seven-week lockdown enforced to contain the coronavirus pandemic. The long-awaited stimulus package amounts to about 10 percent of India’s gross domestic product.
The Canadian government announced additional aid in the form of a one-time payment of up to $500 for eligible seniors to offset any increased living expenses they have incurred as a result of the COVID-19 pandemic.
