Tackling the growing poverty trap … (11) — THISDAY Editorial

Posted by News Express | 10 April 2022 | 676 times

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•Homeless Nigerians


The clear and present danger of a high level of idleness among young persons are already manifest in the level of strife and crimes in virtually every corner of the country. It is a notorious fact that most of the people in the fields and trenches of war are youths who if otherwise meaningfully engaged would have been unavailable for those worthless anti-social endeavours. Worse still is that there is no evidence to suggest that the authorities in Abuja and the 36 states appreciate the gravity of the situation as there are no clear-cut plans to deal with the problem. 

President Muhammadu Buhari had last year blamed the activities of middlemen for the soaring cost of food. While his observation might have a modicum of truth, the unassailable fact remains that the nation’s monetary and fiscal policies are either wrong-headed, half-hearted, or poorly implemented, thereby causing more distortions in the economy, and inflicting more pain on the masses. The unprecedented free-fall of the national currency is unsettling for a country that depends largely on imported machinery, and raw materials for its industries that produce for the local market. 

It is simple economics that if local producers source their raw materials and machinery offshore and are subjected to the vagaries of high exchange rate, the cost of their finished products would reflect their production cost and profit margin. The consumer bears the brunt. The Manufacturers Association of Nigeria (MAN) has cried out over the current scarcity of dollars, with the rising cost of production due to the forex shortage. This is sure to exacerbate the inflationary pressure, thereby worsening the cost-of-living of Nigerians.

While not sounding alarmist, the forex scarcity at the official window which has oiled the parallel market more than ever, is a sure recipe for worsening the cost of living. The situation will be made dire on the eve of an election year, with a voracious political class mopping up more dollars to prosecute their electioneering. Having failed to address the lingering energy crisis which has thrown the entire country into darkness in the face of a seemingly intractable unavailability of petroleum products, there is no doubt that the cost of living of Nigerians is heading to unbearable levels in the days ahead.

We urge the federal government to fashion out measures to salve the frayed nerves of the suffering masses who are currently assailed by unprecedented high cost of living, in the face of rising food prices, transportation, energy cost and more. Some of the recent fiscal measures introduced in its desperation to generate revenue should be suspended. A case in point is the 10 per cent tax on carbonated drinks. Nigerians badly need a reprieve from the current harsh living conditions, irrespective of the fiscal gains the government seeks to reap.

While we recognise that this is a global challenge, what makes the Nigerian situation worse than most other parts of the world is that hard life has been around here for too long. Before Covid-19 and the Russia-Ukraine War – the twin crises that have negatively impacted the entire globe in recent times – Nigerians were already at the mercy of harsh existence. Rising unemployment, inflation, and an increasingly vulnerable currency have continued to torment the people and render their lives miserable. For the few who had managed to save some of their resources, the present predicament occasioned by prolonged fuel scarcity has mopped them up. 

The government should understand that this is no time to let only the forces of demand and supply determine the consumption behaviour of its citizens. People-friendly programmes must be put in place to inject the much-needed hope into the populace.

Source: News Express

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