In Nigeria, a year after the presidential election, the cost of living has exploded

It’s midday and tempers are heating up. At this gas station in the Obalende district of Lagos, dozens of cars and as many pedestrians with jerrycans are trying, amid a hubbub of horns and loud voices, to buy fuel. From one end of the concrete slab to the other, a thin rope was pulled, in order to dissuade – without much success – the influx of customers, this Tuesday, April 30.

For three days, long queues have formed, once again, across Nigeria. In the economic capital of this African giant (220 million inhabitants, the largest population on the continent), they clog the streets for hundreds of meters, worsening traffic jams. The most stubborn, reports the AP agency, sleep in their car, hoping that the early morning will be favorable to them.

“It’s terrible, isn’t it? apostrophe with a big smile “Tike” (he prefers to give only his nickname), 33 years old. As long as I don’t have fuel, I won’t be able to return to work. » This minibus driver has been there for 5 hours. “What we hear is that they are perhaps going to announce a new increase,” he justifies. If the authorities have rather cited a supply problem, the rush testifies to the feverishness of consumers regarding fuels. At the end of May 2023, upon his inauguration, the new president of this oil country, Bola Tinubu, announced the end of subsidies, leading to a three-fold increase in the price at the pump.

“It’s not easy, there are too many problems,” asserts Samuel, who did not wish to give his name, a 21-year-old market seller who came to try to fill an old yellow jerry can with diesel to power his generator, in a country where power cuts are daily. “But we have no choice, he continues. Every day, every day, we try [de gagner notre vie]. » Lagos, a megalopolis of 20 million inhabitants, violently unequal, but also vibrant and eminently resourceful, has an informal motto: “ No food for lazy man » (“no food for the lazy”).

Naira weakness

For the past year, the proverbial resilience of Nigerians has been severely tested by the explosion in the cost of living. Beyond fuels, everything has increased, from rice to cars. The second-hand Toyota Corolla, extremely popular in Lagos because it is inexpensive and fuel efficient, went from around 3 million to 6 million naira (from 2,000 to 4,000 euros).

“We are experiencing a very marked increase in inflation, to the highest level observed in twenty-eight years, i.e. 1996. We are currently talking about more than 30%,” explains Bismarck Rewane, a popular economist and regular on television.

Beyond recent global shocks, he highlights three main causes of the phenomenon. First, the weakness of the naira, which lost 60% of its value against the dollar, after a profound reform and two devaluations, long awaited after years of artificial maintenance of the rate under Muhammadu Buhari, the previous president, 2015 to 2023.

Then, a significant increase in the money supply, decided under Buhari. Finally, the impact of the price of fuel on that of all goods. “Take the bread, suggests Mr. Rewane. Flour is imported, it has gone from 300 to 1,000 naira per kilo. Add to that the sugar, the butter, the yeast… To cook this dough, you use a generator, because of the cuts. However, the price of diesel has tripled, and it represents 25% of the cost of a loaf of bread. All this is immediately reflected in the prices. »

Sluggish growth

The consequences of this multidimensional inflation are aggravated by the structural weaknesses of the Nigerian economy, “a bit like Covid-19, regarding patients with comorbidities”, illustrates Bismarck Rewane. In addition to corruption, which siphons off precious resources, Nigeria faces a revenue problem, according to the economist: tax revenues are not only among the lowest in the world (10% of gross domestic product, GDP) but they come from almost exclusively from the oil windfall, currently in difficulty.

Furthermore, due to the lack of investment, GDP growth is in fact sluggish: at around 3%, it is generally equal to that of the population. In 2024, Nigeria will be ranked as the fourth largest economy in Africa ($253 billion, or approximately 236 billion euros, in GDP), according to the International Monetary Fund. He was in first place two years ago.

Faced with operational difficulties, foreign companies have left the country in recent months (Procter & Gamble), or temporarily closed factories (Heineken). “Anyone who looks at Nigeria’s statistics is a priori excited: a huge market, a potentially rich country. But it takes little time to realize the disadvantages,” analyzes John Adeleke of World Trade Center Lagos, an investor advisory organization. This decline in local production, he believes, will further strengthen imports, in an economy structurally lacking dollars.

Social impact

Above all, the social impact of this situation is immense, in a country where 63% of the population is poor, according to official figures. Residents of Kano, the large northern city, told AFP of being forced to skip meals, give up meat, eggs, milk or eat poor quality rice usually reserved for fish. The influential traditional emir, Aminu Ado Bayero, spoke there ” famine “. In Abuja, the political capital, a food depot was looted by hundreds of people in early March.

In Lagos, economist Adetilewa Adebajo points out that many survive thanks to informal redistribution systems as well as charitable and religious organizations. But when asked whether society was approaching a breaking point, he said it had been reached in the remote but highly populated territories of the northwest of the country, where entire areas had come under the control of armed bands (a destabilization of the State which adds to that of Boko Haram, in the north-east of Nigeria).

A vicious circle, believes the director of asset manager CFG Advisory: “Farmers can no longer cultivate their land there. This loss of food production further fuels inflation. »

The expert castigates them “lost years” under the mandate of Buhari and the interventionist choices “harmful”but he says he is optimistic that the current painful reforms will bear fruit. “It will take time, maybe another year,” he adds. An opinion surprisingly shared by some, up to the other extreme of the social scale.

At Tarkwa Bay, one of the few remaining beaches in this megalopolis bordering the Atlantic, Jonah (who wished to remain anonymous) sells coconuts to Sunday visitors. From the height of his 19 years, he affirms that “the withdrawal of subsidies is an opportunity for the country”. “I believe in the current president, I believe he can make Nigeria a better place to live. We just hope things will improve quickly,” adds the one who uses his income to take online computer courses.