The number of people living in poverty in Nigeria is likely to increase by another 7 million before the end of 2022 because of high inflation. According to the World Bank’s Nigeria Development Update (NDU) published this month titled “The Continuing Urgency of Business Unusual”, Nigeria is living in a paradoxical multiverse where its growth prospects are improving but the overall macroeconomic framework is deteriorating.

The “trenches” is a slang popularized by Nigerians and it describes the rural areas like the ghetto, the streets or a tough situation, which is the most used iteration. For the 83 million Nigerians currently living in poverty and the 7 million more that may join before the end of 2022, they are “in the trenches”.

The biggest pain point however is food, the fuel that powers everyday hustle and bustle. Hardly a week goes by without fresh shock at the prices of regular food items purchased at a lower price one or two weeks earlier. The reality of inflation is even more glaring when the year-on-year change in food items’ prices is examined.

For instance, Michael, an Abuja resident “ported” from actual meat to goat intestines because of cost. He used to buy the full intestines of a goat for N1,500 in 2021. But today, a reduced portion of his goat intestine is sold for a minimum of N2,500. That is an increase of 66.7% in a year. According to him, other food items have also experienced similar increases resulting in him spending more on food alone now than he used to spend. He said that about 30-40% of his salary now goes to feeding.

Esther said her favourite catfish has increased by 80-100% in the last one year. According to her, she buys a medium-sized catfish for about N3,000 now, but before she used to get it for between N1,500-N1,700. The increase isn’t just limited to her catfish but other essential food items she consumes on a regular basis such as yam, pasta, noodles, beans, etc.

Like Michael, Esther is spending more on feeding today than she has ever had, even though her salary has remained the same in the last 2 years. She is saving less from her earnings and cannot afford to invest in the things that could potentially increase her purchasing power and pave a way for an escape from the “trenches”.

The story is not any different for Chioma, who now buys the popular Easy Bite bread in Abuja for N750 against the N450 that she used to get it.

Even the producers of Easy Bite as well as other brands are complaining about the rise in the price of the materials they use in their business. In fact, last Friday, bread producers and caterers through their national body — the Association of Master Bakers and Caterers of Nigeria — threatened to embark on a nationwide strike next month because of the hike in prices of bakery materials.

For Maryam, it’s her favourite morning snack — Akara. “I know the price of stuff is jumping up every day; I have no choice but to buy because I just have to eat but I knew things had really gone bad when my Akara moved from N10 for a piece to N20, and then to 3 for N50. To make things even worse, the size has reduced, which means that I have to buy more than usual to be satisfied”, she said.

Akara is fried bean pudding and the primary ingredient is beans, the cost of one “mudu” of beans has gone up by almost 50% between 2021 and 2022 depending on your location and the type of beans you buy.

Nigeria’s inflation figure has been on a steady increase for months now. In fact, the World Bank said the country’s inflation rate is one of the highest in the world today.

The latest data released by the National Bureau of Statistics (NBS) shows that the inflation rate as of May was 17.7%; which is already above the 15.5% the World Bank projected that it will be by the end of 2022.

In January this year, the inflation rate was 15.6%. At the end of the first quarter of 2022, it was already 15.9%.

The increase didn’t stop there, it grew to 16.8% in April and then 17.7% in May, which means a further increase in the prices of food items.

The World Bank’s initial projection that 6 million more Nigerians will be pushed into poverty this year was based on the projection that the inflation rate will hit 15.5% by the end of 2022. Today, halfway through the year it is at 17.7% which is 2.2% above their projection. Their projection of 7 million more people feel more accurate especially when drilled down to the real impact of inflation on the pocket of Nigerians.

The additional 1 million is attributed to the war in Ukraine which the World Bank explained is adding pressure to the country’s already increasing inflation rate.

“We project that the added inflationary pressure emanating from the war in Ukraine could push as many as one million more Nigerians into poverty, on top of the six million already projected before the war”, a part of the World Bank report read.

In addition to the durum wheat product, both countries export other products like mackerel, herring, dairy, and agricultural products to Nigeria.

What this means is that the unending war will heavily impact Nigeria, as the supply of these products will be disrupted and lead to an increase in the prices of commodities which will affect the purchasing power of Nigerians.

The increased inflationary pressure as a result of the war added to the already existing inflation in Nigeria compounded by factors like lack of flexible foreign exchange (FX) management, trade restrictions, and conflicting monetary policy goals as highlighted in the World Bank report.

In the last two years, an estimated 8 million people were pushed into poverty because of high inflation recorded, which averaged 17% at the end of 2021. With current projections, in 3 years 15 million people would be pushed below the poverty line.

Before 2020, the number of people living in poverty was 80.1 million. With an additional 15 million in the space of 3 years, the total number of poor persons will reach about 95.1 million.

95.1 million is 47.5% of Nigeria’s population; it simply means almost half of Nigeria’s population will be in the “trenches” by the end of 2022.

Source: https://www.dataphyte.com/latest-reports/inflation-may-push-an-additional-7-million-nigerians-into-the-trenches-this-year/

cc: lalasticlala, seun, onila, farano, mynd44, prettythicksme

More: https://www.dataphyte.com/latest-reports/inflation-may-push-an-additional-7-million-nigerians-into-the-trenches-this-year/

It doesn't concern me.

Some fools still want APC

It'is well

And some foolish idiot still want Nigerians to vote for APC. Some Nigerians citizens need a brain check because I don't think a reasonable person will still be talking about APC despite everything we are going through now in the hands of APC government.