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Inflation rate pushes 5m people into poverty

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By Akintola Timothy

World Bank notes a decline in Nigeria’s economic performance due to inflation.

Nigeria is going through another face of inflation that is constantly crippling the socioeconomic system. Some have regarded this situation as the most brutal inflation experienced in the country and the constant deterioration of the social and economic conditions evidently proves them right. In fact, the World Bank states that the country is in a worsening circumstance, with the economic performance gradually declining as the inflation persists. The World Bank made this known during its recently released Nigeria economic and development update which launched in Abuja alongside the Nigeria Country Economic Memorandum.

According to the Nigeria Development Update, it was reported that Nigeria was in an immensely deteriorating economic situation. It also noted that Nigeria’s economic performance which had been hugely affected during the previous Nigeria Development Update that was published in June 2022 and was titled “The Continuing Urgency of Business Unusual”. The country’s growth forecast was cut down to 3.1 percent from the previous 3.8 forecasted percent by the financial institution.

Nigeria’s N30,000 minimum wage now valued at N19,355.

It was noted that this revision was as a result of the slow economic development of the third quarter from the previous year which the oil sector and weak performances in other sectors of the economy contributed to this weak performance. The World Bank further forecast the economic growth to slow down by 2.9 percent by 2023. The report stated that the economic output growth slowed and as a result, the World Bank was reducing Nigeria’s economic growth projection. The domestic product of market prices in the third quarter of 2022 was 2.4 percent year-on-year.

World Bank Lead Economist for Nigeria, Alex Sienaert, whilst presenting this report, noted that Nigeria’s minimum wage of N30,000 could be valued at N19,355 today. That is, an evident loss of about 35.48 percent value between 2019 and 2022 due to the evading purchase power of inflation. It was also pointed that the heightened consumer price inflation was one of the highest in the world. The report posited that though the Central Bank of Nigeria (CBN) was making immense efforts to salvage the growing inflation by enforcing the increase of interest rate, the funding of fiscal deficits through the means advances had complicated the situation.

Surging consumer price inflation up 21.1%, a 17 years high.

It was further noted that the surging rate of consumer price inflation which was one of the highest in the world, accelerated in 2022 through October to be up 21.1 percent year-on-year, a 17 year high. It noted that although inflation was a persistent problem over the past 2 decades, the inflation since 2019 had increased significantly as a result of the multiple exchange rate and exchange rate depreciation in the parallel market. The reports indicated that the exchange rate policy setting in Nigeria were affecting business activities, growth and investment, as well as implementing macroeconomic risks.

The report again indicated that this inflation had pushed over five million Nigerians into poverty between January and October of 2022. Between 2020 and 2021, the World Bank estimated that the inflation pushed at least 8 million more Nigerians below the poverty ratio, increasing the poverty population in Nigeria to about 90 million. It was indicated that the country’s economy was immensely vulnerable to shock and warned that with the growing inflation and unemployment, the insecurity rate would only worsen.

Idahoans noted that Nigeria was in a runaway inflation situation.

As a result of these deteriorating realities in Nigeria, experts have continually questioned the government’s place in salvaging this situation. Gabriel Idahosa, the Deputy President of the Lagos Chamber of Commerce in an interview, questioned the government’s efforts as to the continued increase in the country’s inflation rate. He noted that the country was in a runaway inflation situation, where the inflation rate had become uncontrollable. The Director, Centre for the Promotion of Private Enterprise, Dr. Muda Yusuf also noted that the increasing inflation in the country had raised a major concern among stakeholders in the country.


Related Link

World Bank: Website

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Admin
9 months ago

Inflation rate pushes 5m people into poverty – World Bank notes a decline in Nigeria’s economic performance due to inflation. – Express your point of view.

Iyanu12345ogg
Iyanu12345ogg
Member
9 months ago

The negative records and impacts inflation has on our people is so poor. Likewise the economic performance gradually declining as the inflation persists.Continual efforts to increase the country’s inflation rate should go on non-stop.

Last edited 9 months ago by Iyanu12345ogg
Adeolastan
Adeolastan
Member
9 months ago

When inflation occur or continue to rise without any tangible measure put in place by the government to curb it,the long time effect is poverty which is very bad to any country development.

Abusi
Abusi
Member
9 months ago

Inflation in Nigeria has caused a lot of people to still continue to live in poverty. It is a no brainier that inflation rate will increase extent of poverty in the country.

Remi1
Remi1
Member
9 months ago

The modest economic growth of the third quarter from the prior year, which the oil sector and subpar performances in other economic sectors contributed to, was recognized as the reason for this change.

Kazeem1
Kazeem1
Member
9 months ago

Another kind of the inflation that has been continually bringing the country’s socioeconomic structure to its knees is currently affecting Nigeria.

Chibuzor
Chibuzor
Member
9 months ago

There has been a consistent worsening of social and economic conditions, leading some to call this the most severe inflation the country has ever witnessed.

Adesanyaj72
Adesanyaj72
Member
9 months ago

The Nigerian economy’s performance, which had been significantly hindered since the last Nigeria Development Update, which was issued in June 2022, was examined in this report.

Haykaylyon26
Haykaylyon26
Member
9 months ago

Inflation is continue to rise that why poverty is high we have to control the rate of the inflation it as to be reduce not rising to reduce poverty also people are suffering due to the inflation rate something need to be done our government should find solution

Tonerol10
Tonerol10
Member
9 months ago

Inflation rate pushes 5m people into poverty. This is too bad seeing so many people in Nigeria suffering due to inflation. Poverty is growing high every day. Government of Nigeria need to plan well

Godsewill Ifeanyi
Godsewill Ifeanyi
Member
9 months ago

The funding of fiscal deficits through the monetary advances aggravated the issue even though the Central Bank of Nigeria (CBN) was making enormous attempts to salvage the developing inflation by enforcing the increase of interest rate.

Hassan Isa
Hassan Isa
Member
9 months ago

While inflation has been an issue for the past two decades, the multiple exchange rate and exchange rate depreciation in the parallel market have contributed considerably to a sharp rise in prices in 2019.

Hassan Isa
Hassan Isa
Member
9 months ago

.

Last edited 9 months ago by Hassan Isa
Nwachukwu Kingsley
Nwachukwu Kingsley
Member
9 months ago

The steadily rising level of inflation in the nation had caused a significant amount of alarm among many stakeholders in the nation.

Taiwoo
Taiwoo
Member
9 months ago

The nation’s inflation rate had reached an unmanageable level, which is a precarious circumstance known as “runaway inflation,” and the situation was bad.

jdpumping
jdpumping
Member
9 months ago

Inflation rate is so high an this has affected all sectors in Nigeria with constant increase in all prices skyrocketing and basic salary been static for years.

Christiana
Christiana
Member
9 months ago

This shift was blamed on the oil industry’s weak performance and the relatively lackluster showings of other economic sectors during the third quarter compared to the same period last year.

Tolaniiii
Tolaniiii
Member
9 months ago

The long-term effect of inflation is poverty, which is detrimental to a country’s economic progress if the government does nothing to stop it.

Bola12
Bola12
Member
9 months ago

As a result of the steady deterioration of social and economic conditions, some people are referring to the current period of time as the period of the most severe inflation the nation has ever experienced.

theApr
theApr
Member
9 months ago

The persistent deterioration of the social and economic situations clearly confirms many who have claimed that this situation is the most cruel inflation the nation has ever seen.

Ultra0711
Ultra0711
Member
9 months ago

We must regulate the inflation rate so that it decreases instead of increases in order to eliminate poverty and the hardship that people are experiencing as a result of the inflation rate. Our government should find a solution.

SarahDiv
SarahDiv
Member
9 months ago

We are in serious trouble in this country. Inflation in Nigeria is increasing everyday. If care is not taking to nip the situation in the bud what happen in Sri Lanka will happen in Nigeria but this time it might lead to blood shed .

DimOla
DimOla
Member
9 months ago

When nonentities and greedy set of leaders who are nepotic and sectional in nature what do you expect in such country. They have successfully enrich themselves and putting the country at a very diecy situation. If this inflation is not attented to on time it might lead to revolution.