Showing posts with label Economy. Show all posts
Showing posts with label Economy. Show all posts

Thursday, March 14, 2024

Video - Impact of rising food prices in Nigeria on Ramadan



As the holy month of Ramadan continues, Muslims in Nigeria are grappling with the issue of high living costs. There are concerns that they may have to reduce expenses due to the growing inflationary pressures.

CGTN

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Video - Bakers in Nigeria threaten shutdown amidst rising production costs

Video - Rising Food Prices spark protests and smuggling in Nigeria

 

 

Tuesday, March 12, 2024

Video - Nigeria secures $134 million to tackle food crisis



The facility from the African Development Bank will be used to grow essential crops such as rice, maize, cassava, and soybeans. It's part of the Nigerian government's effort to tackle the nation's deepening food crisis. About 8 percent of Nigerians are food insecure, according to the International Monetary Fund.

CGTN

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Video - Rising Food Prices spark protests and smuggling in Nigeria

 

 

Video - Nigerian companies close due to economic volatility



The Manufacturers Association of Nigeria says as many as 700 companies shut down in the country in 2023. The group blames the closures on various economic difficulties, including exchange rate volatility, rising inflation, and a general worsening of the investment climate.

CGTN

Related stories: People turn to 'throw-away' rice for food in Nigeria due to high rise in cost of living

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Video - Bakers in Nigeria threaten shutdown amidst rising production costs

People turn to 'throw-away' rice for food in Nigeria due to high rise in cost of living

As the rising cost of living continues to bite, many in northern Nigeria are turning to rice grains that millers normally reject after processing or sell to farmers to feed their fish.


These are referred to in the Hausa language, widely spoken in the north, as afafata, which means "battling" because they are literally a battle to cook and eat as the grains are so hard.

"A few years ago, people didn't care about this type of rice, and we usually threw it away along with the rice hulls, but times have changed," Isah Hamisu, a rice mill worker in the northern city of Kano, told the BBC.

Despite the grains being broken, dirty and tough, afafata's cheaper price has made it more attractive for humans and helped poorer families to be able to afford to eat one of the staple foods in the country.

Fish farm owner Fatima Abdullahi said her fish love it but because people are now eating afafata, its price has risen.

Prices in Nigeria are increasing at their fastest rate for nearly 30 years. On top of global pressures, President Bola Tinubu's cancellation of the fuel subsidy plus the devaluation of the currency, the naira, have added to inflation.

A standard 50kg (110lb) bag of rice, which could help feed a household of between eight and 10 for about a month, now costs 77,000 naira ($53; £41). This is an increase of more than 70% since the middle of last year and exceeds the monthly income of a majority of Nigerians.

In the face of this many are struggling to cope and in some states there have been cost-of-living protests.

Earlier this month in Niger state, central Nigeria, protesters blocked roads and held placards saying that they were being suffocated by the rising prices.

A few days later there was a similar demonstration in Kano in the north-west. In the aftermath, Governor Alhaji Abba Kabir Yusuf admitted there was starvation in his state and said a solution must be found.

The solution, for now, for some is found in afafata.

Hajiya Rabi Isah, based in Kano state, told the BBC that if it were not for this type of rice her children would go hungry as she cannot afford the normal kind.

"Normal rice is 4,000 naira ($2.70) per bowl which is beyond my means, I can only afford afafata which is 2,500 naira ($1.69) now," she said. One bowl of rice from the market can feed an average family in Kano for a day.

"Without afafata, feeding my family would be a major issue for me."

Market sellers have also noticed a difference.

Saminu Uba, who works in Kano's Medile market, said the afafata side of his business is booming.

"Most people can no longer afford normal rice and they come for this which is cheaper even though it tastes less good," he told the BBC.

One of his customers, Hashimu Dahiru, admits people are having to find ways of adapting.

"The cost of goods is alarming - in just two months the price of everything has doubled,'' he said.

"Our wives spend hours removing stones and dirt from the rice before cooking and even then it ends up tasting not nice, but we have to eat to survive."

The presidency has said it is doing all it can about the situation, including the distribution of more than 100 tonnes of grains such as rice, millet and maize in the hope that it would cushion the effects of inflation and help lower the market price.

But the president's aide Bayo Onanuga upset many recently when he said that Nigeria still had one of the lowest costs of living in Africa.

The increasing price of rice is not a new problem though.

President Tinubu's predecessor, Muhammadu Buhari, banned the importation of rice to encourage more Nigerian farmers to grow the crop, but local producers have been unable to meet the demand.

Before then Nigerian markets were filled with rice from Thailand at an affordable price for many.

Mr Tinubu has lifted import restrictions, but now the shortage of foreign currency and the falling value of the naira has made bringing in rice trickier.

By Mansur Abubakar, BBC

Related stories: Residents break into Abuja govt warehouse, steal food

Nigeria tightens security as food theft continues amid soaring inflation

Video - Rising Food Prices spark protests and smuggling in Nigeria

Thursday, March 7, 2024

Foreign Minister says Nigeria plans to join BRICS

Nigeria intends to seek membership in the BRICS organization after carrying out necessary measures within its state, according to Yusuf Tuggar, the Foreign Minister of Nigeria, who said this in an interview with RIA Novosti.

The head of Nigeria's Foreign Ministry arrived in Moscow for an official visit on Wednesday.

"We have this intention. As I've already mentioned, Nigeria has a democratic system with deliberative elements. Therefore, before taking such measures, we usually carry out active interaction with various interest groups and different internal bodies," said Tuggar.

The minister noted the significance of the presence of Nigeria's Vice President, Kashim Shettima, at the most recent BRICS summit in South Africa.

"We are extremely interested in this, and we look forward to this," stressed the Nigerian Foreign Minister.

Oreanda 

Related story: Foreign Minister of Nigeria says No justification for Gaza carnage

 

Monday, March 4, 2024

Residents break into Abuja govt warehouse, steal food

Some residents of the Nigerian capital, Abuja, broke into a government warehouse in the city to loot food items.

The incident happened on Sunday morning, Daily Trust reports. It started around 7 a.m. and continued till about 9 a.m., residents told the newspaper.

Sunday’s incident happened amid the current economic crisis in the country which has seen the prices of goods and services increase by over 200 per cent without a corresponding increase in income.


The cost of living crisis was caused by the removal of subsidies on petrol and the floating of naira; policies justified by the government as necessary for the economy.

PREMIUM TIMES reported that the cost of living crisis has led to protests in several parts of Nigeria.

The warehouse looted by the Abuja residents on Sunday was also reportedly looted during the COVID-19 crisis in 2020.

The police, however, told Daily Trust that police officers had arrived at the scene and normalcy had been returned.

PREMIUM TIMES will provide more details of Sunday’s incident in subsequent reports.

By Popoola Ademola, Premium Times

Related stories: Nigeria tightens security as food theft continues amid soaring inflation

Video - Rising Food Prices spark protests and smuggling in Nigeria

Nigeria tightens security as food theft continues amid soaring inflation

Nigeria's National Emergency Management Agency (NEMA) announced Sunday (Mar. 3rd) it was increasing security at its facilities, Amid increased cases of attacks on warehouses.

The Director General of NEMA has instructed Zonal Directors and Heads of Operations to strengthen security in and around the Agency’s offices and warehouses nationwide “to forestall any breaches”.

Africa's largest economy is also the continent's most populous country.

Nigerians are living through one of the west African nation's worst economic crises in years with inflation rising to nearly 30% and the consequences of monetary policies that have pushed the Naira to an all-time low against the dollar.

One of the nation's most powerful trade unions launched protests last week demanding immediate measures to quell hunger.

In a letter to the president, it notably called for the “Opening of all food storage silos across the country,” to ensure equitable distribution.

The decision by the National Management Agency comes after residents broke into a facility in the capital Abuja to steal food items including bags of maize.

The incident reportedly went on for hours.

Africa News 

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Video - Rising Food Prices spark protests and smuggling in Nigeria

 

 

Friday, March 1, 2024

Central Bank of Nigeria revokes licences of 4,173 exchange bureaus

Nigeria's central bank said on Friday it had revoked the licences of 4,173 exchange bureaus that failed to comply with its guidelines and directives, including rendering returns of transactions and payment of required renewal fees within the due period.

The central bank, which resumed dollar sales to exchange bureaus this week, outlawed street-trading of foreign exchange and raised minimum capital levels for exchange bureaus to at least 2 billion naira ($1.3 million) under new guidelines released on Feb. 23.

The moves are part of broader reforms to Nigeria's forex market which has been grappling with chronic foreign exchange shortages.

Central Bank of Nigeria (CBN) spokesperson Hakama Sidi Ali said the licences of the affected exchange bureaus were also revoked due to non-compliance with anti-money laundering and terrorism finance regulations.

"The CBN is revising the regulatory and supervisory guidelines for Bureau de Change operators. Compliance with the new requirements will be mandatory for all stakeholders in the sector when the revised guidelines become effective," Sidi Ali said in a central bank statement. 

By Elisha Bala-Gbogbo, Reuters

Related story: Video - Nigeria detains Binance executives

 

Thursday, February 29, 2024

Video - Bakers in Nigeria threaten shutdown amidst rising production costs



Master bakers across the country contemplate shutting down operations due to escalating prices and excessive taxes. They want the government to bring down the cost of bread production and reduce import duties on baking materials and equipment.

CGTN

Related story: Video - Rising Food Prices spark protests and smuggling in Nigeria

 

Video - Central bank of Nigeria raises interest rate to 22.75%



The interest rate hike is in response to surging inflation which has reached 29.9 percent. The rise in inflation is largely driven by fiscal deficits, rising food prices, a weakening naira, and the removal of a fuel subsidy.

CGTN

Related story: Video - Nigeria inflation hits high of 29.9%

 

 

Wednesday, February 28, 2024

Video - Nigeria inflation hits high of 29.9%



Inflation in Nigeria soared to 29.9 percent in January, the highest mark in nearly 30 years. Food costs, which rose at an average rate of 35.4 percent in the same month, are the main driver of the rising cost of living.

CGTN

Related stories: Video - Rising Food Prices spark protests and smuggling in Nigeria

Nigeria unveils big rate hike as hardship prompts worker protests

 

 

Nigeria unveils big rate hike as hardship prompts worker protests

Nigeria's central bank delivered its largest rate hike in absolute terms in around 17 years on Tuesday to tame soaring inflation, amid nationwide trade union protests over price rises that have left people struggling to meet their basic needs.

Central Bank of Nigeria Governor Olayemi Cardoso said the 4-percentage-point increase to 22.75% was needed as previous rate hikes had not cooled price pressures enough.

Inflation has reached almost 30%, its highest in almost three decades, driven by a steep fall in the naira currency , the removal of a fuel subsidy, fiscal deficits and conflict in food-producing parts of Africa's most populous nation and biggest economy.

Labour unions protesting on Tuesday said two of President Bola Tinubu's key reforms - allowing the naira to devalue twice in less than a year and scrapping the fuel subsidy - were making people's lives a misery.
"We are suffering in Nigeria. It was not like this before. There is real hunger," said fashion designer Surijadeen Idayat at a protest in the capital Abuja.

In a sign of the desperation, a deadly stampede broke out at a food distribution site on Friday, authorities said.

"This was not the situation a year ago. I have to cut down the number of meals in the family," said Ibrahim Mamuda, a 56-year-old resident of the northern city of Kano who said he has twelve children and that they are only eating one meal a day.

Tinubu has defended his bold but unpopular reforms, which he hopes will help him double Nigeria's growth rate to 6% annually from roughly 3% now.

In an effort to ease the pressure on vulnerable households, his government this week approved the resumption of direct cash transfers to those in need.

MAMMOTH HIKE

Tuesday's mammoth rate hike brings Nigeria closer to Ghana, which defaulted on its debts in 2022 and cut interest rates from 30% to 29% in January, and the insurgency-hit Democratic Republic of Congo, which has an interest rate of 25%.

Nigeria's international dollar bonds initially rose as much as 0.5 cents on the dollar as Cardoso spoke, before falling to again trade below their previous closing price.

Capital Economics analyst David Omojomolo said that Cardoso had "stepped up to the plate" by showing greater appetite to tackle Nigeria's inflation problem than the central bank had done previously.

But he said further inflation surprises or naira weakness could force another hike. 

By Chijioke Ohuocha and Elisha Bala-Gbogbo, Reuters

Related stories: Video - Rising Food Prices spark protests and smuggling in Nigeria

Video - Nigeria vows to address rising cost of living amid protests

Tuesday, February 27, 2024

Video - Rising Food Prices spark protests and smuggling in Nigeria



Nigeria is on the brink of a food crisis as skyrocketing prices, exacerbated by smugglers, leave millions struggling to afford basic necessities. The situation has prompted trade unions to call for protests against the government's handling of the crisis. The cost of food has risen by almost 40% in the past year alone, leaving many Nigerians unable to feed themselves or their families. With no end in sight to the crisis, the country is facing an uncertain future.

Al Jazeera

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Friday, February 23, 2024

Video - GDP growth stronger than expected in Nigeria



Data released by Nigeria's National Bureau of Statistics showed that gross domestic product grew 3.46 percent in the fourth quarter of 2023. That pace was quicker than in the two preceding quarters. Analysts credit the growth to increased oil output, and government reforms to boost growth that are finally taking effect.

CGTN

Video - Nigeria vows to address rising cost of living amid protests



The government said it will deploy measures, including greater security for farmers against attacks from armed groups and providing them with better tools to increase production. Protesters are angry at the high rate of inflation, driven largely by high food prices and the government's decision to end a fuel subsidy.

CGTN

Related stories: Video - Nigeria sees hundreds hit the streets over growing crisis

Protests in Nigeria over skyrocketing inflation as local currency hits record low value

 

 

Wednesday, February 21, 2024

Tuesday, February 20, 2024

Protests in Nigeria over skyrocketing inflation as local currency hits record low value

Nigerians are facing one of the West African nation’s worst economic crises in years triggered by surging inflation, the result of monetary policies that have pushed the currency to an all-time low against the dollar. The situation has provoked anger and protests across the country.

The latest government statistics released Thursday showed the inflation rate in January rose to 29.9%, its highest since 1996, mainly driven by food and non-alcoholic beverages. Nigeria's currency, the naira, further plummeted to 1,524 to $1 on Friday, reflecting a 230% loss of value in the last year.

"My family is now living one day at a time (and) trusting God," said trader Idris Ahmed, whose sales at a clothing store in Nigeria’s capital of Abuja have declined from an average of $46 daily to $16.

The plummeting currency worsens an already bad situation, further eroding incomes and savings. It squeezes millions of Nigerians already struggling with hardship due to government reforms including the removal of gas subsidies that resulted in gas prices tripling.
 

A SNAPSHOT OF NIGERIA’S ECONOMY

With a population of more than 210 million people, Nigeria is not just Africa’s most populous country but also the continent’s largest economy. Its gross domestic product is driven mainly by services such as information technology and banking, followed by manufacturing and processing businesses and then agriculture.

The challenge is that the economy is far from sufficient for Nigeria’s booming population, relying heavily on imports to meet the daily needs of its citizens from cars to cutlery. So it is easily affected by external shocks such as the parallel foreign exchange market that determines the price of goods and services.

Nigeria's economy is heavily dependent on crude oil, its largest foreign exchange earner. When crude prices plunged in 2014, authorities used its scarce foreign reserves to try to stabilize the naira amid multiple exchange rates. The government also shut down the land borders to encourage local production and limited access to the dollar for importers of certain items.

The measures, however, further destabilized the naira by facilitating a booming parallel market for the dollar. Crude oil sales that boost foreign exchange earnings have also dropped because of chronic theft and pipeline vandalism.


MONETARY REFORMS POORLY IMPLEMENTED

Shortly after taking the reins of power in May last year, President Bola Tinubu took bold steps to fix the ailing economy and attract investors. He announced the end of costly decadeslong gas subsidies, which the government said were no longer sustainable. Meanwhile, the country's multiple exchange rates were unified to allow market forces to determine the rate of the local naira against the dollar, which in effect devalued the currency.

Analysts say there were no adequate measures to contain the shocks that were bound to come as a result of reforms including the provision of a subsidized transportation system and an immediate increase in wages.

So the more than 200% increase in gas prices caused by the end of the gas subsidy started to have a knock-on effect on everything else, especially because locals rely heavily on gas-powered generators to light their households and run their businesses.


WHY IS THE NAIRA PLUMMETING IN VALUE?

Under the previous leadership of the Central Bank of Nigeria, policymakers tightly controlled the rate of the naira against the dollar, thereby forcing individuals and businesses in need of dollars to head to the black market, where the currency was trading at a much lower rate.

There was also a huge backlog of accumulated foreign exchange demand on the official market — estimated to be $7 billion — due in part to limited dollar flows as foreign investments into Nigeria and the country’s sale of crude oil have declined.

Authorities said a unified exchange rate would mean easier access to the dollar, thereby encouraging foreign investors and stabilizing the naira. But that has yet to happen because inflows have been poor. Instead, the naira has further weakened as it continues to depreciate against the dollar.
 

WHAT ARE AUTHORITIES DOING?

CBN Gov. Olayemi Cardoso has said the bank has cleared $2.5 billion of the foreign exchange backlog out of the $7 billion that had been outstanding. The bank, however, found that $2.4 billion of that backlog were false claims that it would not clear, Cardoso said, leaving a balance of about $2.2 billion, which he said will be cleared "soon."

Tinubu, meanwhile, has directed the release of food items such as cereals from government reserves among other palliatives to help cushion the effect of the hardship. The government has also said it plans to set up a commodity board to help regulate the soaring prices of goods and services.

On Thursday, the Nigerian leader met with state governors to deliberate on the economic crisis, part of which he blamed on the large-scale hoarding of food in some warehouses.

"We must ensure that speculators, hoarders and rent seekers are not allowed to sabotage our efforts in ensuring the wide availability of food to all Nigerians," Tinubu said.

By Friday morning, local media were reporting that stores were being sealed for hoarding and charging unfair prices.
 

HOW ARE NIGERIANS COPING WITH TOUGH TIMES?

The situation is at its worst in conflict zones in northern Nigeria, where farming communities are no longer able to cultivate what they eat as they are forced to flee violence. Pockets of protests have broken out in past weeks but security forces have been quick to impede them, even making arrests in some cases.

In the economic hub of Lagos and other major cities, there are fewer cars and more legs on the roads as commuters are forced to trek to work. The prices of everything from food to household items increase daily.

"Even to eat now is a problem," said Ahmed in Abuja. "But what can we do?"

AP

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Nigeria's latest devaluation may be 'turning point' in currency reform drive

Authorities in Nigeria Voice Worry as Rising Cost of Living Sparks Protests

Unemployment rate in Nigeria surges to 5% amidst rising cost of living

This information was disclosed in the Nigeria Labour Force Survey (NLFS) report for Q3 2023, released on Monday. Per the NBS, this rate represents a 0.8% increase from the second quarter of 2023, where the unemployment rate stood at 4.2%.

The unemployment rate among men was 4.0% and 6.0 among women. By location, the unemployment rate was 6.0% in urban areas and 4.0% in rural areas. Focusing on young people, the youth unemployment rate was 8.6%.

In Q3 2023, 75.6% of Nigeria's working-age population were employed. When examining the data by gender, the employment-to-population ratio was 77.7% for males and 73.5% for females.

Further disaggregation by location revealed an employment-to-population ratio of 71.1% in urban areas and 80.7% in rural areas.

The report noted that 87.3% of employed Nigerians were predominantly self-employed, while the remaining 12.7% were primarily engaged as employees. 80.3% of employed people in urban areas were self-employed this is lower when compared with 94.5% of employed people in rural areas.

Informal employment

Informal employment in Nigeria and other developing countries seems to be very high when compared to the developed countries.

The percentage of employed individuals engaged in informal work was 92.3%, a slight decrease from the previous quarter's 92.7%. Interestingly, the rate of women involved in informal employment exceeded that of men.

"The rate of informal employment among people living in rural areas was 97.2% while the urban informality rate was estimated at 87.5%. Females are more likely to be in informal employment than males," the report said.

By Adekunle Agbetiloye, Business Insider Africa

Related story: Video - Graduates from Nigeria turn to creating jobs instead of looking for them

Monday, February 19, 2024

Naira hits record lows, stocks sink

The Nigerian naira fell to record lows on both the official and unofficial markets on Monday, while stocks posted their biggest one-day fall in more than a year, as jittery investors sold off local assets.

The currency dropped to 1,712 naira per dollar in late trades on the official market and to around the same level on the unofficial market after extending losses.

Africa's largest economy has been experiencing crippling dollar shortages that have pushed its currency to record lows, though central bank Governor Olayemi Cardoso has said that foreign exchange liquidity is improving.

The latest fall on the currency and stock markets comes after data showed on Thursday that the country's inflation rate had accelerated further in January, reaching almost 30% in annual terms, driven by soaring food costs.

"Without policy moves in sight to rein in inflation, the naira will continue to devalue simply on a purchasing power basis. There are also risks that it could further deter foreign investors, given the increasingly negative real yield found in Nigerian debt securities," said Kyle Chapman, FX markets analyst at London-based Ballinger & Co.

Stocks on Nigeria's All-Share Index fell 3.15% on Monday after banking, consumer goods and industrial shares dropped, to post their single biggest fall since Oct. 2022.

Heavyweight Dangote Cement and MTN each fell the maximum 10% allowed on the bourse, to help drag the index to 102,395.21 points.

Stocks had been acting as a hedge against inflation for investors.

Cardoso has hiked open market rates to draw investors to bills which had lost their shine to equities as inflation climbed, but treasury rates still lag the benchmark policy rate and the fall in the naira means yields would have to rise further. 

By Chijioke Ohuocha, Reuters

Related stories: Nigeria's latest devaluation may be 'turning point' in currency reform drive

Video - Nigeria caps foreign exchange position for banks

Thursday, February 15, 2024

Nigeria to clear debt, fix gas shortages in plan to end power woes

Nigeria plans to fix its chronic power woes by settling outstanding debts of about $2.16 billion to energy producers and tackling gas supply shortages to generating firms, the power minister said on Wednesday.

Africa's largest economy has 12,500 megawatts of installed capacity but only produces about a quarter of that, forcing households and businesses, including manufacturers to resort to diesel and petrol generators.

Power Minister Adebayo Adelabu told reporters on Wednesday that outstanding debts, inadequate gas supplies and ageing equipment were the key barriers hampering optimal power output.

Adelabu said power generators are currently owed 1.3 trillion naira ($858.65 million), in addition to a $1.3 billion legacy debt from a decade ago.

"Part of preparation to turn around and transform the sector is the settlement of existing outstanding debt obligations to the gas supply and power generation companies using partly cash payments and guaranteed debt instruments," he said.

Last week, Adebalu proposed a naira payment for gas sales to power plants as a solution to solve dollar shortages as costs are expected to balloon after a second currency devaluation in less than a year.

Natural gas is sold in dollars to power plants because investments tied to building gas processors and pipelines are priced and paid for in dollars.

Grid power is erratic in Nigeria, Africa's most populous nation. The grid collapsed on Feb. 4, causing a national blackout, and at least three times in 2023, which authorities blamed on technical problems. 

By Camillus Eboh, Reuters 

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