Many people in Nigeria are shocked at the surge in the cost of cassava flakes. Production of cassava flakes or garri, as they are locally known,, is being hampered by rising insecurity which has led to death and kidnapping of farmers for ransom.
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At a warehouse in Nigeria's commercial capital Lagos, dozens of women patiently wait their turn to receive food handouts. Among them is 68-year-old widow Damilola Salami, who received an invitation to the facility just as she had almost run out of food.
The Lagos Food Bank is a crucial lifeline to residents like Salami, but has seen supplies from private and other donors fall as inflation soars in Africa's biggest economy.
Nigeria is grappling with the worst cost of living crisis in decades, which has deepened since President Bola Tinubu rolled out bold but unpopular economic reforms after assuming office last May.
"There is nothing for us to eat, we are hungry," said Salami as she waited for her share of food and cooking oil. "Our children are out of school because of the increase in fees. Now, the children are at home and there is no food."
Mabel Wade, an 80-year-old charcoal seller, said sustenance was scarce and she often relied on neighbours before she was told of the food bank.
"Sometimes there is no food to eat at all... Sometimes, it is biscuit and water," she said, after registering for food stamps.
Last month a stampede broke out and killed seven people at a food distribution centre in Lagos.
World Bank data shows that 46% of Nigeria's population was deemed poor in 2023. Twenty million of them live in urban areas.
In the past, the imposing warehouse of Lagos Food Bank would be fully stocked with bags of Nigerian staples like rice, beans and vegetable oil. Not anymore.
Founder Michael Sunbola said the facility's major donor had cut supplies by 93%, citing the high cost of food.
The food bank has now dialled back on quantities, providing families with enough supplies for a few days at a time when once their parcels would have lasted two weeks. The facility is also having to "narrow down the number of people we want to reach out to", said Sunbola of the people invited to use the service.
"Now, we do only women from the age of 50," he told Reuters.
No Hunger Initiatives, a food bank serving mostly internally displaced people in the capital Abuja, faces similar problems.
The number of people seeking food handouts has tripled since May 2023 but the facility is unable to keep up because donors have cut back supplies by half due to rising inflation, said Kumdet Yilkon, a senior official.
By Ope Adetayo, Reuters
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According to data released by the National Bureau of Statistics, Nigeria registered a significant increase in used-vehicle imports last year. However, dealers say the growth could be even stronger if not for a crippling cost-of-living crisis and falling local currency.
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One dry-season farmer says his crops are withering away because of soaring fuel prices. He and other farmers need gasoline to fuel their irrigation systems. But fuel costs have tripled since the removal of a fuel subsidy. Farm productivity is down as a result.
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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.
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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.
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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.
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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
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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.
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MTN Nigeria faced a challenging year in 2023, as the telecoms giant reported a loss after tax of ₦137.0 billion, a huge contrast to the ₦348.7 billion profits recorded in 2022.
The net foreign exchange loss for 2023 compared to 2022 was N740.434 billion, showing a YoY increase of +804.93%, as opposed to N81.822 billion in the previous year. However, revenue grew by 22.7% from N2.01trn to N2.47trn.
This is contained in the company's audited financial results for the year ended 31 December 2023.
According to Karl Toriola, MTN Nigeria CEO the telecom giant witnessed a very challenging operating environment characterised by rising inflation, currency devaluation and foreign exchange shortages, complicated by geopolitical disruptions and cash shortages in Q1.
The financial statement revealed that MTN's services revenue grew by 22.4%, driven primarily by data revenue growth of 39.8%. Voice revenue was up by 9.7%.
The company sustained robust commercial momentum in its connectivity business and platforms, fueled by the expansion of its user base, reaching over 4 million subscribers in 2023 and elevating the total base to 79.7 million. Data subscribers for the company increased by over 5 million to 44.6 million, which helped to drive total data traffic growth of 44.9%.
Dividend payment:
On 27 July 2023, the company's Board of Directors approved interim dividends of N117.48 billion for the year ended 31 December 2023 (Interim 2022: N113.99 billion). The interim dividend were paid out of interim profit made during the same period and represents N5.60 kobo per ordinary share on the issued share capital of 21 billion ordinary shares of 2 kobo each for the period ended 30 June 2023.
Given the significant currency devaluation and its impact on the retained earnings, the Directors will not be recommending a final dividend payment, in view of the resulting loss for the year ended 31 December 2023.
Fintech revenue
This increased by 2.4%, led by Xtratime (our airtime lending product), which rose by 2%. However, despite the challenges from the NIN requirement for KYC introduced in Q4 by the CBN, we added 3.3 million active wallets in the year to 5.3 million. This helped to drive MoMo PSB revenue, which rose by 8.1%.
Active mobile money (MoMo PSB) wallets increased by 163% to 5.3 million, powered by 326,000 MoMo agents, and 324,000 merchants in its ecosystem.
Outlook
MTN says it expects 2024 to be a challenging year due to the rising inflation and devaluation of the naira. In January 2024, the inflation rate reached 29.9%, while the exchange rate has further devalued to N1582/$ as of 26 February 2024. "This is anticipated to put additional pressure on consumers, the cost of doing business and further potential forex losses," it said.
By Adekunle Agbetiloye, Business Insider Africa
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Nigeria's currency crisis has triggered an exodus of businesses from the country. At least four multinationals, including GSK, Bayer and Sanofi, have announced they're ending production, as a scarcity of dollars, a naira in freefall and rampant inflation slashes profits. Bloomberg's Jennifer Zabasajja reports.
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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.
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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.
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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
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China's President Xi Jinping pledged on Thursday for his country to increase investments in Nigeria's power generation sector and its digital economy, the Nigerian vice president's office said in the wake of a Belt And Road Initiative forum in Beijing.
Nigeria's National Agency for Science and Engineering Infrastructure (NASENI) and three Chinese partners signed contracts for new projects valued at $2 billion, Vice President Kashim Shettima's office said.
It added that another $4 billion worth of letters of intent was received for new projects and investments in different sectors of the economy.
Nigeria is seeking to attract investments to boost sluggish growth in Africa's biggest economy, which is saddled with mounting debt, high inflation and unemployment.
The agreements signed include vehicle assembly projects, solar products, vehicle design and production, drone technology transfer, clean energy utilisation and the development of an industrial park.
Nigeria also signed contracts with China Harbour Engineering Company for the construction of the Lekki Blue Seaport in Lagos.
Shettima met Xi, who asked for the protection of Chinese workers in Nigeria, according to the vice president's office.
China had committed to rail projects in Nigeria in the past and to a seaport in Bonny Island in the Niger Delta. But the projects are still waiting for loan disbursements after securing approvals from China Exim Bank and Nigeria's parliament.
At the Belt And Road Initiative Forum, China also committed to refinancing the completion of two rail projects that stalled due to a cut in China's funding commitments. China had earlier agreed to provide 85% of the financing for the rail projects.
By Felix Onuah, Reuters
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Nigerian authorities say the country's inflation rate jumped to nearly 20% in July, compared to last year, the highest in nearly two decades. Consumers in Africa's biggest economy are struggling to keep up with rising prices for basic foods.
Nigeria’s National Bureau of Statistics (NBS) said Monday the country’s inflation rate in July was 19.64% - the highest rate since September 2005.
A NBS report found the highest increases were for necessities like food, fuel, transportation and clothing.
Food prices have risen steadily in Nigeria for years, due to the effects of climate change, the COVID-19 pandemic and widespread insecurity.
But in February, when Russia invaded Ukraine, commodity prices soared, affecting the ability of millions of citizens to meet their basic needs.
Abuja resident James Orshio earns the equivalent of about $50 a month from his sales job but said his salary can no longer cushion economic pressures.
"There's a lot of challenges now due to the increment [increases] of prices; I cannot even talk of going to the market now to buy something to feed myself because the prices are not encouraging at all,” he said. “A loaf of bread that used to be 300 naira is now 1,000 naira. Even some of the bakers in Abuja are not working because of the high price."
In a bid to address inflation, Nigeria's Central Bank (CBN) has been tightening monetary policy by increasing interest rates from 11% in January to 14% in July.
Akintunde Ogunsola, founder of Abuja-based financial consulting firm Karma Professional Service, explained the reason for the CBN’s policy.
"What is happening is that we have too much money in circulation chasing a few goods, and that's what causes inflation,” he said. “There is scarcity in supply and that's why CBN is using the open market operation to reduce the money in circulation by increasing [the] interest rate so that people will be saving money back into the bank, like mopping up money from the economy."
Nigeria's import-dependent economy has been further hit by currency devaluation. The naira has lost more than 30% of its value in seven months.
But Ogunsola said inflation nowadays is a global problem.
"It's not only in Nigeria alone that we're experiencing this,” he said. “The United States’ inflation is also going up. Even our neighbors, Ghana, their inflation rate is already over 30%.”
In March, the World Bank estimated that about 4 out of 10 Nigerians live below the national poverty line.
Experts predict the inflation rate will increase further in coming months and may put many more Nigerians on the brink of poverty.
By Timothy Obiezu
