By John Ikani
A new report reveals Nigeria’s struggle with affordability, ranking it the fifth most impacted African nation by the global cost-of-living crisis.
Numbeo, a data analysis platform, released its mid-2024 cost-of-living index, placing Nigeria fifth with a score of 31.4. Cameroon tops the list with a score of 37.3, signifying the most severe cost-of-living crisis on the continent.
Zimbabwe, Mauritius, and South Africa rank ahead of Nigeria with scores of 37.2, 37.1, and 34.5 respectively.
Numbeo gathers data through user input and verified sources like supermarket websites, taxi companies, and government institutions. Verified data is entered twice annually.
Nigeria’s economic challenges began in May 2023 with the federal government’s removal of fuel subsidies. This aimed to reduce government spending and reallocate funds to critical sectors.
However, the average price of gasoline (PMS) skyrocketed by 211%, jumping from N187 to N630 per litre, with no clear support for vulnerable populations most affected by these reforms.
A month later, the government floated the naira, aiming to stimulate economic growth. However, the naira’s value plummeted by 67.8%.
Critics argue these reforms were rushed and, while intended to attract foreign investment, they’ve fueled inflation, eroded purchasing power, and intensified the cost-of-living crisis.
Nigeria’s inflation reached a record high of 33.95% in May 2024, with food prices soaring to near three-decade highs.
Beyond food and basic necessities, which account for over half of Nigeria’s inflation, high energy costs and frequent rent increases are further straining household budgets.
If these affordability challenges remain unaddressed, many Nigerians risk falling below the poverty line as rising prices continue to erode disposable income.
The World Bank estimates 87 million Nigerians already live below the poverty line, making it the world’s second-largest impoverished population, following India.
The federal government, however, has pledged a significant food import plan to alleviate the cost-of-living crisis, particularly regarding food items.
This follows the president’s earlier declaration of a “State of Emergency” on food security. While food inflation remains high at 40.66%, the government’s rollout plans may offer some relief.
“In recent months, we’ve all witnessed the escalating cost of food across the country,” stated Abubakar Kyari, the Minister of Agriculture and Food Security.
“Virtually no food item has been spared, with prices exceeding the reach of many Nigerians. The government cannot allow this situation to continue. While agricultural initiatives are ongoing at the federal and state levels, a stronger response is needed to address the growing food availability crisis.”
