A year ago, I wrote about what Nigeria’s land border closure means to a baby given birth to within the poverty cycle. In the article, I submitted that, “border closure will have a ripple effect as Nigeria is a consumer economy with many forward and backward linkages because we — the citizens and the government — have failed to tackle overpopulation, inflation and unemployment.” This fact continues to haunt the entirety of its existence every millisecond.
Since August 2019, when the federal government gave the directive for partial border closure, many Nigerians have been faced with hardship, especially those living within the poverty level. Data evidence is seen in the food prices index which increased by 4.21 percent between August 2019 to September 2020. The purchasing power of households continues to depreciate as prices of food staples and condiments like onions, pepper, tomatoes increase by over hundred percent.
As much as we want to blame COVID-19 for the increase in food prices, it had little influence as land borders were already closed before the lockdown began. But in the midst of coronavirus socio-economic effects, the federal government has: increased fuel price five times this year [the stagnant price in April was the bonanza period]; implemented VAT increment across all sectors and businesses [with hints that it wants to increase it again]; given electricity distribution companies the greenlight on tariff increase [the grace period has little effect on an average Nigerian] and; devalued Naira through CBN but the most used exchange rate value, the black market, remains a wild card as one US dollar to naira sells around five hundred naira.
The aforementioned influences Nigeria’s rising inflation rate which increased by 0.52 percent to 14.23 percent in October, the highest figure recorded since March 2018. An NBS survey of 1,881 households revealed that sixty-eight percent of Nigerian households experienced moderate or severe insecurity in August due to COVID-19 pandemic while over half of these respondents used loans taken after the lockdown to pay for food items. This was when food inflation was at sixteen percent, can you imagine what it would be like for these households when it has increased by 1.38 percent?
After the ease of lockdown across all sectors and industries, Nigeria’s land borders were reopened for Dangote and BUA but remained closed to other users, which is detrimental to Nigeria’s business environment. How will this not impact on the large percentage of micro businesses or SMEs whose business survival is hinged on imports through land borders?
Land borders are closed; total foreign trade has dropped by 27.46 percent as at second quarter of 2020; global oil price tanked to its lowest in 2020 but Nigeria’s petrol price has been increased five times within same year; naira continues to rise against the dollar at an unpredictable rate and; government increased VAT payment to 2.5 percent, how will inflation rate not continue to surge?
Many people blamed COVID-19 for the increase in the country’s unemployment rate, forgetting that the federal government has worsened Nigeria’s business environment with unfavourable policies like VAT, border closure and other policies which has led some businesses into foreclosure, how will this not steep the underemployed and unemployed curve negatively?
Worldometer data revealed that between 2000 to 2020 while Egypt’s population grew by 34 million, Kenya’s 22 million, South Africa’s 14 million, Rwanda’s 5 million, Zimbabwe’s 3 million, Nigeria’s increased by 84 million, means it averages 5,500 babies per day. How can the overpopulated citizenry be catered for in a country which lacks verified population data and has high illiteracy rate with increased insecurity issues?
Breaking out of this economic quagmire requires an administrative and systemic reform of government policies and citizens’ reorientation. There is need for President Muhammadu Buhari to take a step back into reality as the blueprint of his economic policies during his military rule in the 80s (closure of borders) is detrimental in the twenty-first century due to globalisation and technology.
In the same breath, the government needs to own up to the insecurity issues plaguing the country and be implement proactive tactics in resolving it as there is no way food prices will not increase, if bandits continue to hold Northern farmers to ransom and demand for bounties before they can access their farm lands and harvest their produce.
The current administration’s business environment is too toxic for investors and entrepreneurs, one of the reasons for reduced foreign trade, investments and SMEs survival. Hence, the government needs to formulate and implement policies like the CAMA 2020 and give exemptions on VAT increment in order to enable business break even.
N-Power programmes, the NYIF Fund and other initiatives may help to curb unemployment rates in the short run but the government needs to revitalise and make reforms in its education, business and bureaucratic sectors, these reforms are long term plans that will minimise unemployment rate.
From a wider perspective, high population has a negative effect on the economic policies [in terms of service delivery and all-round access], when there is corruption and mismanagement in the picture. But nationwide census is of essence, to enable government make policies using reliable data, not estimates. However, relevant agencies and NGOs must invoke no-to-cancel-culture tactics to bring discussions like sex education, contraceptives, birth control, teenage pregnancy and family planning to rural households and poverty-ridden areas.
Nigeria is shrinking in on itself because the government has lost touch with reality and the earlier they [politicians and power brokers] reconnect with it, the better for everyone because the deeply rooted silence culture has bred a full-fledged wide-eyed generation with booming voices, yearning for change. And the government cannot keep up shutting it down and out.