The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) says the instability of the naira and its sliding value against globally traded currencies like the US dollars, euros and pound sterling, is a major trigger of the high cost of living in Africa’s largest economy.
Festus Osifo, president of PENGASSAN, stated this when he led the executives of the oil workers’ union to interact with labour journalists in Lagos. Osifo noted that the unpredictability of the naira and by extension, Nigeria’s business environment, poses a threat to investors, particularly foreign investors, thus denying the economy much-needed employment opportunities.
The naira exchanges with the dollar at N415.69/$, with pounds sterling at N522.10, and with euro at N438.42 at the official rate. At the black market, the trades at around N580/$.
The country’s unemployment rate, according to the Q4 2020 report of the National Bureau of Statistics (NBS), is 33 percent, while youth unemployment is 42 percent. These rates are considered among some of the highest in the world.
Osifo said it was, therefore, not surprising that the cost of living in Nigeria and unemployment have continued to soar with no end in sight.
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He said it was high time the managers and drivers of monetary policies and the government focused more on how to stabilise the naira, such that would-be investors are encouraged to make their projections and be attracted to stake their hard-earned funds in the Nigerian economy.
“For example, a foreign investor who wants to bring about $1m into Nigeria will consider what becomes of that money in one or two years. If after carrying out his feasibility studies, he discovered a risk associated with the unpredictability of the naira, you don’t expect him to take that plunge. No investor wants to lose money,” said Osifo.
The PENGASSAN president added that the leadership of the labour movement should be more concerned about the stability of the currency by engaging the managers of the economy, much more than the N30,000 national minimum wage which value is already wiped off by inflation as a result of the continued sliding of the naira.
Osifo, who also decried increasing insecurity of lives and property in the country, warned that unless addressed, it could lead to challenges capable of affecting the peaceful conduct of the 2023 general elections.
“You know before now, labour has been calling for the decentralisation of the police system. We cannot have less than 200,000 police personnel policing the entire population of about 200 million; it is extremely ineffective.”
On casualisation of labour in the oil and gas sector, Osifo said the union was collaborating with its counterpart – the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), to ensure that workers in this category are allowed to exercise their rights.
“We are discussing with NUPENG to have a workshop, where we will bring all the stakeholders together. We will come up with a communique that is implementable, with an action plan on how we will further address the issue of casualisation,” he said.
