By Eben Enasco
But during the regime of former President Muhammadu Buhari, the cost of living escalated to the point where consumer prices increased at their fastest pace in 17 years. The World Bank recently asserted that some policies of the Nigerian government are pushing more citizens into different levels of poverty. In the submission of its latest report in Nigeria Development Update (NDU), 2023, the apex Bank cited that the position of the Country’s Inflation has become the highest globally. The summary of the report that was launched on Tuesday June 27, 2023, in Abuja is that an estimated four million people were nudged between January and May 2023 into deeper deficiency. In the NDU 2023 report, the global lender warned that about 7.1 million poor Nigerians would become poorer if the Federal government fails to compensate or provide palliatives for them, following the removal of fuel subsidy. According to World Bank data, 89.8 million Nigerians were poor as of the beginning of the year 2023. It, however, declared that the number rose to 93.8 million with an additional four million that became poor between January and May of the same year. The Bank stated that the number may further rise to 100.9 million if the government fails to compensate vulnerable citizens for fuel subsidy removal.
Successive Governments in Nigeria have pushed estimated millions of citizens into categories of deprivation with different Policies.
Citizens believe that each government every season thinks about an action plan that will create total depression and anxiety without putting into consideration the aftermath of their decisions.
In the aftermath of the Fuel Subsidy Removal in Nigeria, Consumer price inflation has risen and is now one of the highest globally, which is related to Nigeria’s fiscal imbalance and a clear pointer to the urgency of reform efforts.
The cost of living for the economically insecure in Nigeria has been high for many years, a development attributed to structural factors or Policies.
But during the regime of former President Muhammadu Buhari, the cost of living escalated to the point where consumer prices increased at their fastest pace in 17 years. The World Bank recently asserted that some policies of the Nigerian government are pushing more citizens into different levels of poverty.
In the submission of its latest report in Nigeria Development Update (NDU), 2023, the apex Bank cited that the position of the Country’s Inflation has become the highest globally.
The summary of the report that was launched on Tuesday June 27, 2023, in Abuja is that an estimated four million people were nudged between January and May 2023 into deeper deficiency.
In the NDU 2023 report, the global lender warned that about 7.1 million poor Nigerians would become poorer if the Federal government fails to compensate or provide palliatives for them, following the removal of fuel subsidy.
According to World Bank data, 89.8 million Nigerians were poor as of the beginning of the year 2023. It, however, declared that the number rose to 93.8 million with an additional four million that became poor between January and May of the same year.
The Bank stated that the number may further rise to 100.9 million if the government fails to compensate vulnerable citizens for fuel subsidy removal.
Multiple reports have demonstrated that CBN’s lending to the Federal government over the stipulated limits was negatively impacting inflation and consequently compounding poverty levels.
The Nigerian government has continued to treat citizens with a high level of sentiment and impunity, due to their selfish interests as a few cabals put countrymen into apron grips.
Most policy bills of successive governments in Nigeria are kept away from the people and hurriedly passed into law without an impute from those the law is meant to have a direct effect on.
The government is like a wife planning a surprise birthday party for her husband and sending him out to the supermarket as a ruse, a trick so she could sneak one hundred of his closest friends into the house without him noticing.
In a message by a social crusader, Omoyele Sowore on National TV, he described the problem with Nigeria as not being affected by its population but by the population of its thieves.
By implications, In the immediate term, the removal of the petrol subsidy has caused an increase in prices, adversely affecting poor and economically insecure Nigerian households, while the cabals are smiling to the huge deposits in their Banks.
Petrol prices seem to have almost tripled following the subsidy removal.
On Monday 29 May, in his inaugural speech, President Bola Tinubu said Nigeria’s fuel subsidies would be scrapped, citing budgetary concerns. The decision led to a steep rise in fuel prices and widespread panic-buying of fuel.
Some bus companies have been unable to refuel their vehicles, leaving many people stranded.
Reacting to the removal, a Pan-Niger Delta Forum PANDEF expressed support for fuel subsidy removal, even as it called for immediate palliatives to cushion the effects of the removal on Nigerians.
National Publicity Secretary of PANDEF, Ken Robinson, who said this on Thursday at a virtual news conference, urged President Bola Tinubu not to be swayed by sentiments being expressed in some quarters but to immediately roll out the palliatives to cushion the hardship which the removal might have on the people.
He said that there was no need for phased subsidy removal, saying that the subsidy regime itself was marred with fraud.
President Bola Tinubu’s decision to remove the fuel subsidy has left millions of Nigerians terrified about the knock-on effects that it will have on their daily lives.
The poor and economically insecure households, who directly purchase and use petrol, as well as those that indirectly consume petrol, are adversely affected by the price increase.
Among the poor and economically insecure, 38 percent own a motorcycle and 23 percent own generators that depend on petrol. Much more use petrol-dependent transportation.
The resultant effect is that the poor and economically unsafe households will likely face an equivalent income loss of N5,700 per month, and, without compensation, an additional 7.1 million people will be pushed into poverty.
In the smallest of nutshells, the possibility of caregivers not sending their children to school, not going to the health facilities to seek preventive healthcare, or cutting back on nutritious dietary choices, will perforate the tin line left for the survivors who have faced the smallest of economic succor among the poor people.
Average locals will not be able to provide basic needs for their families if they continue to have their ways.
The World Bank warned that many newly poor and economically insecure households would likely resort to consequential coping mechanisms, listed above.
The Bank stressed the need for adequate compensation, noting that compensating transfers would be essential in helping to shield Nigerian households from the initial price impacts of the subsidy reform.
The lending institution further applauded the removal of the subsidy and foreign exchange management reforms, which it maintained were crucial measures in rebuilding fiscal space and restoring macroeconomic stability.
The Central Bank of Nigeria (CBN) Monetization of the fiscal deficit, multiple exchange rates and exchange rate depreciation in the parallel market, and intensified trade restrictions, exacerbated by the spike in global food and energy prices also drive the information.
Multiple reports have also noted that the consumer price index further accelerated in 2023 through May by 22.4 percent year-on-year.
According to the various reports the CBN is said to have implemented measures to control rising inflation, including raising the monetary policy rate by 700 basis points.
The development only proved ineffective, and monetary policy remained loose overall in the first half of the year.
The loss of purchasing power from high inflation has increased poverty in the short-term, pushing an estimated four million Nigerians into poverty between January and May 2023.”
The National Bureau of Statistics (NBS) recently disclosed that inflation in the country rose to 22.41 percent in May, which is the highest in about 19 years.
Also, the NBS, in its National Multidimensional Poverty Index (MPI) report, disclosed that 133 million Nigerians were multi-dimensionally poor.
The NBS said 63 percent of Nigerians were poor due to a lack of access to health, education, living standards, employment, and security.
In its new report, the World Bank noted that the loss of purchasing power increased the poverty headcount rate by an estimated 2 percentage points, or four million people.
The World Bank added that the number of poor people in rural areas increased by an estimated four percent, while in urban settings, there was an estimated increase of 11 percent.
The Nigerian authorities must urgently put in place measures to protect the rights of people most affected by the removal of the fuel subsidies and prioritize addressing widespread hunger, higher unemployment, and the rapidly falling standard of living.
