Nigerians come to terms with spiralling inflation

Lagos housewife Ifeoma Ibeh was preparing to make a stew when she noticed the pepper, onions and tomatoes were missing. One of her neighbours had sneaked into the shared kitchen and stolen them.

She later tracked down the culprit, who confessed and apologised, explaining he took the ingredients as he didn’t have enough money to buy them himself.

“I had no choice than to forgive him when he told me he was hungry and had nothing to eat,” she told AFP at her home in the eastern suburb of Oworonshoki.

“To prepare a pot of stew costs around 6,000 naira ($21, 19 euros) as against 3,000 naira previously.”

Ordinary Nigerians are feeling the full effects of spiralling inflation which in May soared to a more than six-year high of 15.6 percent.

The cost of living is predicted to rise further after Nigeria this week scrapped the naira’s peg to the US dollar, allowing the currency to float. Since the new exchange rate regime started Monday the naira has lost around 40 percent, translating into much higher prices for dollar-denominated imports.

Imported food was already up 18.6 percent in May and fuel rose 67 percent in April — a fall-out from the global slump in oil prices that has weakened the local currency and led to forex shortages.

Nigeria, one of Africa’s main producers, normally gets 70 percent of its revenue from oil sales but the crash has left the government cash-strapped and even unable to pay wages.

Public sector workers in most of the country’s 36 states are on strike because of unpaid salaries, with some owing employees up to six months’ back pay.

– High prices –

Amaechi Abaje sat in his shop in Oke-Arin market on Lagos Island and said business was slow.

“Customers no longer come as before. They cannot afford the high prices of items,” he said.

A 50-kilogram bag of rice currently sells for 15,000 naira. Not long ago, the price was 8,000-9,000 naira.

Other staple foods such as beans, millet, cassava flour and wheat, vegetable oil and even soap have doubled in price, Abaje said.

“My shop is almost empty. I don’t have enough money to replenish because my capital has been drastically eroded as a result of the fall in the value of the naira,” he said.

Mary Idowu said she has had to pass on increased transportation costs to customers who visit her roadside restaurant in the Obalende neighbourhood.

“I have increased the price of a plate of rice to 500 naira from 300 just to make a little gain,” she explained.

President Muhammadu Buhari’s government, elected last year on a promise to transform Nigeria, this week acknowledged the country is going through a difficult time.

But his claim that the hardship is necessary to get the economy back on track is no consolation to Idowu.

“This is not the change we voted for,” she said, referring to Buhari’s election campaign slogan.

“This hardship is too much.”

– Money-saving –

Nigerians, well acquainted with regular fuel shortages, lack of electricity and poor public services, have, typically, been devising survival strategies.

Car owners have abandoned their vehicles for public transport. Bus users have begun walking to avoid fare increases.

“I don’t use my car to the office anymore. I go to work by public transport, which is better than buying petrol at 145 naira per litre,” said Ayodele Ajadi, a banking supervisor.

James Adeola, from the city’s Abule-Egba area near Lagos airport, said he and a neighbour had hit on a plan so both can save money.

“I worked out a formula of car sharing: one week on, one week off. What it means is that if we use his car this week, we shall use mine the following week,” he said.

He has also started skipping lunch.

“What’s important is food, paying school fees and my NEPA (electricity) bills,” he said.

– Minimum wage –

The federal government in Abuja has agreed to bail out insolvent states for the second time in just over a year but with growth and investment stalled, employees are hit hard.

Most firms — private and public — are struggling to generate revenue to pay bills and salaries, which have failed to keep pace with rising costs.

Nigeria’s main workers’ union, the National Labour Congress (NLC), wants a new minimum wage of 56,000 naira per month as it considers the current 18,000 naira “no longer realistic”.

NLC general-secretary Peter Ozo-Eson appealed to states to pay their employees and said it was “immoral and criminal to deny workers their wages under any guise”.

“The ongoing strikes in some states will continue until the workers are paid,” he added.


Culled from France24

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