Nigeria’s Inflation rate has continued its rise recording the 29th month surge to 13.22% in August 2020, O.40% higher than the 12.82% in July, according to the state’s statistics Bureau.
This is even as petrol and power price rises have continued to upset business owners.
According to the National Bureau of Statistics (NBS), the over two year rise was largely due to supply disruption of goods and services ocassioned by the covid 19 pandemic.
Food inflation stood at 16% in August 2020, compared to 15.48% in July 2020. This rise in the food index was attributed to increases in prices of Bread and cereals, Potatoes, Yam and other tubers, Meat, Fish, Fruits, Oils and fats and Vegetables.
Highest increases were also recorded in prices of Passenger transport by air, Hospital services, Medical services, Pharmaceutical products and others.
But the hike in prices of power and petrol has continued to leave sour tastes with business owners who are currently reeling from the double whammy of price rises for the two products.
But galloping inflation, which the central bank expects to rise to 14.15% by the end of the year, is increasing costs for businesses and their customers.
Our investigations show that just as the galloping inflation rate has continued to impoverish Nigerians, the price hike will send many artisans as well as small entrepreneurs out of business.
Earlier this month president Muhammadu Buhari said the increases, announced days apart in early September, were needed to bolster Africa’s biggest economy, which for years has been urged by multilateral lenders to remove costly fuel subsidies and change electricity tariffs, both of which held prices artificially low.
But, coming at the time that most Nigerians are suffering from the six month lockdown ocassioned by the Covid-19 pandemic, Nigerians may be in for serious hardship.
“I won’t say I’m coping… it has not been easy for us,” said Abiodun, an operator of a baring shop, who added that he feared losing customers if he raised his prices.
According to him, higher fuel costs meant he rationed the use of his diesel powered generator which, like many businesses in Nigeria, is used to make up for the patchy power supply provided by the national grid, even as Kainji Dam is currently facing another major challenge from Monday’s overflow of its banks.
“I won’t say I’m coping… it has not been easy for us,” said Abiodun, an operator of a baring shop, who added that he feared losing customers if he raised his prices.
According to him, higher fuel costs meant he rationed the use of his diesel powered generator which, like many businesses in Nigeria, is used to make up for the patchy power supply provided by the national grid, even as Kainji Dam is currently facing another major challenge from Monday’s overflow of its banks.
Meanwhile, naira on Monday fell by 1.09 per cent to N460 on the parallel market. The decline followed President Buhari’s directive to the Central Bank of Nigeria (CBN) to stop dollar sales for food and fertiliser imports.
On the official market supported by the CBN, the naira traded at N381 to the dollar, while it was quoted at N385.83 naira on the spot market yesterday.
Buhari last Thursday directed the CBN to stop selling foreign exchange for those imports, similar to an order issued last year.
Nigeria’s economy contracted by 6.1% in the second quarter due to the impact of the coronavirus pandemic and low oil prices. Africa’s top oil exporter relies on crude sales for 90% of her foreign exchange earnings.
