On May 1, 2022, the U.K. Observer published an article entitled, Observer Views on the cost of living problem. The editorial list focuses on the challenges of living costs in Britain, which are due to lower real household incomes compared to higher energy and food prices because wages fail to keep up with rising debt. This article highlighted the impact of this crisis, the UK government’s inadequate response and the steps that can be taken to improve living standards quickly.
There are similarities to be drawn here in the economic situation in Nigeria. Not only has the standard of living in Nigeria plummeted at an unprecedented rate in the last two decades but the government’s response has been tense and has failed to stop, let alone backward, a worrying trend. The depth, speed and duration of the fall in living standards are difficult to measure with any certainty in a world known for poor data and record keeping. Checking in official sources reveals little. The best source left is inflation statistics. Although they tell us how fast prices are going up, they are not looking at the planned decline in living standards as energy and food prices continue to rise and how wages are failing to keep pace with rising debt.
A detailed analysis of the various issues reveals the depth of the cost of living crisis in Nigeria. Although per capita income has been rising for the past 20 years, the shocking inequality associated with Nigeria’s economic growth and huge economic inequality means that the impact of rising living costs has not been equally felt. For those in charge of news, private and public companies, this will not be registered. For some families, rising prices have meant making difficult decisions when choosing a method of reducing consumption, such as disposing of certain basic food items and other necessities.
For many Nigerians, the rise has expanded already insufficient budgets, forcing increased poverty as they struggle to balance small resources to cover the cost of food, energy, transportation, shelter and health care bills. This situation is also compounded by the lack of urgent measures to reduce poverty, despite the growing number of people living in poverty. The latest figures put the number of Nigerians over 80 million. Lack of relevant data, however, makes it difficult to pinpoint how deep and widespread the problem is and which parts of the country are most affected. Perhaps this is simply a reflection of the government’s failure to respond to such a crisis.
Government actions over the past few years can be reduced to a massive social investment program that has nothing to do with investing in any common sense and epidemics that were ineffective and not well thought out to have a real impact. In other words, there has been no attempt to address the issue of living standards. This leads to the conclusion that the attention of ministers and government officials has been trained in the pursuit of their own interests and the 2023 elections with the aim of advancing themselves instead of developing public works and promoting public interest. This is reflected in the increase in the tax burden on citizens as financial constraints and declining incomes have led the government to increase VAT and significantly increase public debt to finance the budget.
Unfortunately, government spending continues on salaries and other ongoing costs. Government actions are in conflict with the general economic system of promoting economic activities and instead increase the cost of living. It is difficult to conclude that the difficulties faced by the people do not affect those in government who have the authority to solve the problem effectively.
The worrying lack of appropriate policies and measures should be of concern to those in power as it may be regarded as negligence, a misunderstanding of the magnitude of the problem or a lack of understanding in establishing the necessary solutions to deal with difficult and changing difficult economic conditions. and to describe Nigerian society and life.
What we have seen so far is not only unsustainable policies but also the cost of projects that have not positively impacted on the cost of living or created real work opportunities but instead worsened the fiscal position of government as rising levels of domestic and foreign debt increased.
Nigeria is facing a long-term recession. Real wages are low, productivity is declining, the economy is collapsing, policies are rational and when combined, these factors have pushed prices up sharply. Our productivity in all economic endeavors and production costs are at an all-time high compared to similar countries all over the world and across the continent. Which means we can’t compete.
Sadly, there are no shortcuts to life expectancy. Either way should be multipronged. In this context, there are at least three important steps that we must take to begin the process of coping. First, economic policies need to focus more on product growth and ensure that profits and benefits are shared equally between different economic agents — financiers, producers, employers and consumers. One of the reasons why poverty levels have risen is that unemployment has increased in the development of geometry while economic growth has not been a positive statistical development. Indeed, where there are jobs, wages and income do not pay enough to ensure the minimum standard but which we define.
This situation can only be addressed through economic policies that focus on job creation, overcoming inequality between rural and urban areas, income and.