One cool evening at an Abuja-based fast-rising grocery outlet, a mother of three, who came shopping with her eldest child, was forced to report a ‘seeming’ sharp practice to a supervisor at the supermarket.
She observed an attendant removing things discreetly from the shelves.
“Thanks madam, he is doing his job. Our suppliers just informed us about a hike in the prices of some items and our staff is putting the new prices on the tags,” the supervisor explained.
On a closer look, the shopper was shocked at the price hike, a whopping nearly 100 percent increase on the current price.
“Why? I bought this milk N2,800 two weeks ago, why N4,200?
The civil servant, who is yet to receive the promised increase in minimum wage, asked rhetorically.
At the open market, the situation seems worse as
sellers now fix prices according to their choice.
Iya Magaji, a cement wholesaler in Okota, Lagos, sells a bag of cement with extra N1000 against the retail price from Dangote Cement, the supplier.
Her reason is simple. “If you don’t want to buy, go to another seller,” she will tell disgruntled buyers carelessly.
Reacting to the unwarranted price fixing, Samad Rabiu, chairman of BUA Cement, sometime this year, disclosed that despite efforts by his company to sell cement at a fair price of N3,500 per bag, dealers inflated prices to as high as N7,000 to N8,000 per bag.
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For the masses, food is the most important thing now. But sadly, it is out of their reach due to the rising cost of food items in the market.
This situation has given food vendors the opportunity to dish out very little portions and tiny pieces of meat for ridiculous amounts.
Kunle Braimoh, a mechanic at Apo Village, Abuja, decried that the portion of food Mama Ebun sells to him is not even enough for his seven-year-old daughter, yet she has tripled the price since April.
“Anytime I ask why the small portion and increase in price, Mama Ebun will ask me to ask my wife who goes to market. I know that prices of things are high now, but these food vendors can increase the portion and reduce the price and still make money. Everybody wants to live like Abuja politicians, but we all cannot,” Braimoh decried.
Same goes for sellers of other items who take advantage of the rising inflation to rip people off, every day.
But the worst, for many, is the irregular prices of petrol as fuel stations fix any price they like, while taking advantage of the incessant scarcity to rip people off.
“We can’t continue this way. Imagine a fuel attendant inputting N24,000 for me in his PoS for 20 litres of fuel, when the rate on the meter is N1050. He insisted that his rate is N1200 per litre, and that someone even bought a full tank at N1,250 per litre an hour ago. It was the manager’s intervention that resolved the issue,” Julius Onuka, a Lagos-based telecom engineer, lamented.
Sadly, again, many landlords are increasing rents of houses they built many years ago when the costs of acquiring land and building materials, especially cement, were cheaper.
In Lagos, there seems to be a uniform increase in house rent as a two-bedroom flat goes from N1million now in most areas, especially mainland where it used to be cheaper.
In Port Harcourt, Ambrose Afigba, a Finimah indigene, relocated to his riverine town until he secured a cheaper accommodation in Choba, while many are forced to move to as far as Obigbo, Elele and Omagwa because of the yearly increment in rents by landlord.
“We were ejected last February when one NDDC staff bought the one-storey building, with four-flat, we were occupying. After three months’ renovation, a flat now goes for N2.2 million from N1million. The hike is too much and nobody is asking questions,” Afigba noted.
While most tenants blame real estate agents for the hike, Olajide Kolade, an Isolo, Lagos landlord, explained that the frequent hike in house rent is to reflect the current value of their properties.
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“I finished my first building, a one-storey, with four flats, in 2001, then rent was N100,000. I have increased the rent five times since then to reflect our current realities and property value. It would be ridiculous to collect N100,000 today as rent, when the same flat is going from N1.5 million to N2 million.
“Property is investment, and the increase in rent is a good return on the investment. Also, we need to renovate the house, pay land use charges, pay estate fees, and they are passed on to the tenants. If you can, build your own house, no matter how small and the location, it is a sure investment. Don’t envy or hate landlords for increasing rents, when you build your own, you will understand,” Kolade explained.
Despite the above rationale and also the fact that Nigeria runs a capitalist economy, Onyewuchi Akagbule, a senior lecturer with the Nnamdi Azikiwe University, Awka, noted that the incredible rise in inflation puts the country in desperate situations, which also requires desperate measures to address.
He thinks that the government should wade in to save the situation, which, according to him, is almost out of hand.
“Nigerian businesses are only mindful of profit and expansion, while the average Nigerian is selfish. That is why everyone is taking advantage of the rising inflation to fix prices and rip people off. Even in the United States of America that is the father of capitalism, the government comes in with a bit of control to save the vulnerable and the economy too. Our government should do the same,” Akagbule said.
Ayomide Lamidi, an economist and ex-banker, who now resides in Birmingham, UK, noted that those who preach capitalism do not follow it to the letter because some situation may happen that would warrant government’s intervention like price control as the case may be.
“Here in the UK, the government strictly controls prices of certain things and also subsidises some items to check inflation. Yet, they will shout capitalism and we are copying them blindly. Nigeria should model its economy after Asian countries; a mix of being a bit flexible and a bit controlled.
“The government should not listen to the IMF every time, we did not gain much from their measures the last time we implemented them. Some Asian countries are called Asian Tigers today because of their huge economic and technological feats, which are possible without the IMF and World Bank dictations. The people have been suffering and need help very urgently now,” he said.
But while the indiscriminate fixing of prices calls for urgent action by the government, the Federal Competition and Consumer Protection Commission (FCCPC) has distanced themselves from plans to regulate prices in the Nigerian market.
The little attempt by the FCCPC, with the directive to businesses to halt practices such as price gouging and price fixing, was heavily opposed by the Organised Private Sector and other stakeholders.
According to Ondaje Ijagwu, director, Special Duties and Strategic Communication, FCCPC, price control is not a mandate of the commission, but supports efforts at curbing exploitative practices and maintaining a competitive marketplace.
“We categorically assert that prices in a competitive marketplace are determined solely by the forces of supply and demand. Price control is entirely outside the scope of our responsibilities.
“We have never considered, nor will we ever consider, intervening in the market to regulate prices,” Ijagwu said.
But most concerned Nigerians think that the FCCPC stand is not fair enough as it is seen as the last hope of the downtrodden in the face of the exploitative practices out there.
“Government denies increasing fuel pump price, FCCPC declines in controlling prices and the masses are at the mercy of the market forces. Why do we have a government then, scrap FCCPC. The government is failing us a great deal, it is very sad,” Lamidi decried.
But the lackadaisical attitude of the government to checking inflation, especially price, according to Akagbule, is worsened by the recent praise by the World Bank that the reforms of the present administration were yielding fruits, as well as the warning against the reversing of the economic reforms, despite the rising hardship in the country.
It would be recalled that Ndiame Diop, Country Director for Nigeria, World Bank, recently noted that while the policies of President Bola Tinubu are believed to be responsible for the current hardship in the country, they were necessary for Nigeria’s long-term stability.
Speaking on the gains of the reforms, he said that the recent increase in the Federal Government’s revenue in the first half of the year was largely due to the removal of fuel and forex subsidies, hence the need to sustain the reforms.
“Reversing these reforms would be detrimental and would spell doom for Nigeria,” he warned.
Countering the World Bank, many Nigerians argue that the increased allocations to states now by the Federal Government are not reflecting in terms of development as most state governors allegedly loot huge chunks of the allocation.
“President Tinubu removed fuel subsidy and is sharing the money to state governors who will only loot them. Despite more allocation from the federal government, the way the governors go after internally generated revenue is mad. The governors are bringing all manner of taxes on the people. It is better to keep the subsidy than give the money to the governors because they will not account for it,” Chijioke Umelahi, an Abuja-based lawyer said.
In the same vein, Bala Mohammed, governor of Bauchi State and chairman of the People’s Democratic Party’s (PDP) Governors’ Forum, noted that the fiscal and monetary policies of the government are not yielding results in the areas of poverty alleviation and unemployment, while urging the federal government to review them.
Considering the level of hardship, Mohammed feared that the Tinubu administration has put the political class at the risk of being lynched by the hungry masses.
“With all humility, please review your policies; they are not working. Even the growing Federation Account Allocation Committee (FAAC) allocation is not enough because inflation is eating it up and the purchasing power of the people is dwindling. We are all living with these people, and I can tell you we are at risk of being lynched because of your policies.
“We should go back to the basics. Nigerians are not enjoying the regime across board,” the governor said.
Meanwhile, the stability the World Bank sees is far from many Nigerians, who think that many would have been out of job, some dead of hunger and the inability to buy the cheapest drugs before the economy stabilises.
With the capitalist mindset and no controls, Nigerians are going to witness more price fixing by businesses and individuals who have always taken advantage of the situation.
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