Musings on Nigerian masses, energy crises, and skyrocketed food prices
The recent report on Nigeria’s inflation rate showed it climbed to a 65-month high on skyrocketing food prices. Now, check that again: Inflation jumped to the highest level the nation has seen in about 65 months—an equivalent of more than five years.
According to data released by the National Bureau of Statistics, the nation’s inflation rate in the month of June 2022 surged to 18.6% compared to 17.71% recorded in May, representing the fifth consecutive monthly rise. Of course, the last time the inflation rate in Nigeria touched that ceiling was January 2017, when it surged to 18.72%.
Consequently, against the background of surging rates, the NBS also disclosed that food inflation, a very important index in the mix, rose to 20.6% in June 2022 from 19.5% recorded in May 2022. The rise in the index was caused by increased prices of bread and cereals, food products, potatoes, yams, and other tubers, meat, fish, oil and fat, and wine.
Amid global economic uncertainties experienced in the wake of another global health crisis, Nigerians are being hit in different directions by socio-economic challenges of varying degrees. How well the masses survive depends largely on policy decisions made by those in leadership positions in the coming months. Nigeria is among the countries with the highest inflation rates globally, thanks to its fast-growing CPI.
Before this period, food inflation reached 17.2% and 18.37% in March and April, respectively.
Many governments' (self-)appointed spokespersons have linked the rising food prices to the global uncertainty surrounding the COVID-19 pandemic. But some issues affecting food inflation in Nigeria are tied to the government's (in)decisions.
Fuel Crisis
Since the first half of the year, the Nigerian people have not enjoyed a stable fuel supply across states.
Although the crisis got to its crescendo when the government announced the importation of off-spec fuel into the country earlier in the year, the crisis started last year when the government announced plans to remove fuel subsidies and later shelved the idea. Since then, fuel supply around the country has been "epileptic," with a ripple effect on commodity prices, transport costs, and the prices of household goods. This month, the crisis has worsened, compelling many Nigerians to cough out the money in the range of N250 and above for a litre of petrol amid scarcity and festivities.
According to Statista, food prices in April 2022 increased considerably compared to April 2021. Within the period, tomato, groundnut oil, and palm oil prices increased the most, with the price of a kilogram of tomato growing by over 53 percent compared to the previous year. In comparison, the price of vegetable oil rose by 46 percent.
Shockingly, among all selected food products, none recorded a price decrease!
Power Conundrum
Despite warnings that Nigeria may be plunged into a food crisis if the prices of essential food commodities continue to rise unabated, the situation has failed to abate. Rather, a ghastly combination of fuel crises and poor electricity has pushed many Nigerians into hardship and excruciating misery.
In 2022 alone, the national power grid collapsed five times, plunging the nation into darkness. Between 2010 and 2019, Nigerian electricity consumers have had to contend with 206 power grid collapses, nine of which occurred in 2019, according to data from the System Operator (SO), a section of TCN. The grid collapse, which led to a power cut for a whole region or even the entire country, shows that 109 incidents occurred from 2010 to 2013, while 97 others were recorded from 2014 to 2019.
The ripple effect of the collapse is that businesses involved in food preservation have either been forced to shut down or seek alternative supplies at huge operational costs. This is in effect transferred to the final consumers, the Nigerian masses, in the form of high prices.
An Interconnected Chain of Disasters
Apart from power and fuel, widespread anarchy and insecurity have also contributed immensely to the food crises, forcing farmers away from their farms. Aside from the decade-long Boko Haram crisis ravaging Nigeria’s North-East, the nation is equally faced with communal conflicts and banditry across the North-central and North-western states. These crises have left thousands of people dead and millions—predominantly farmers—of rural dwellers displaced.
In May, the Centre for Democracy and Development (CDD) said that at least 60,000 people had been killed in Nigeria’s 18 northern states in the last ten years due to insecurity. In a new report titled “Multiple Nodes, Common Cause: National Stocktake of Contemporary Insecurity and State Responses in Nigeria,” the CDD said in the Northwestern states of Jigawa; Kaduna, Kano, Kebbi, Sokoto, and, Zamfara, about 14, 000 people lost their lives between 2011 and 2021. Similarly, CDD reported that approximately 11,000 people were killed in the North-central states, including the Federal Capital Territory, Kogi, Kwara, Nasarawa, Niger, and Plateau. In contrast, about 35,000 people were killed in the Northeast states of Adamawa, Bauchi, Borno, Gombe, Taraba, and Yobe.
The killings and displacement have contributed immensely to the food crisis amidst the global uncertainty thrown up in the global food supply ecosystem by the Ukraine-Russia war.
A Not-So-Dark Tunnel?
The Food and Agriculture Organisation (FAO) says that around 660 million people may still face hunger in 2030, partly due to the lasting effects of the COVID-19 pandemic on global food security – 30 million more people than in a scenario in which the pandemic had not occurred. In other words, the number of people facing hunger may be close to double the current population of the United States or triple that of Brazil.
To halt the downward slide, FAO recommends some solutions that may help countries like Nigeria avoid a major crisis; food system transformation with “greater resilience to major drivers, including conflict, climate variability and extremes, and economic slowdowns and downturns.”
Nigeria is presently at a crossroads and critical juncture wherein it would select yet another leader that would have to contend with the challenges and proffer creative solutions to solve these teething problems.
The big question remains: Who among the leading candidates could bell the cat?