Yuletide: Nigerians Lament Price of Goods, Predict Bleak 2021

As the year gradually draws to an end, Nigerians have slammed the federal government over the poor state of the economy, particularly the nation’s inflation rate. 

According to the December 2020. Business Expectation Survey Report by the Central Bank of Nigeria (CBN) respondents lamented the poor handling of the control of inflation rate in the country. 

The apex bank said that the December 2020 Business Expectations Survey was conducted online from December 7-11, 2020 with a sample size of 1050 businesses nationwide. 

A response rate of 91.3 per cent was achieved and the sample covered the agric services, manufacturing, wholesale or retail trade and construction sectors, where respondents firms expressed dissatisfaction with the management of inflation by the Government with a negative net satisfaction index of -33.5 in December 2020.

The net satisfaction index is the proportion of satisfied less the proportion of dissatisfied respondents. 

The respondent firms were made up of small, medium and large corporations covering both import-oriented and export-oriented businesses. 

The nation’s economy in November fell into recession, it’s second in five years since the coming on board of the President Muhammadu Buhari led administration. With the country’s currency experiencing a consistent decline, exchanging for as high as N 500 / $1. in late November. While figures from the National Bureau of Statistics (NBS) in its Consumer Price Index (CPI) in November 2020 noted that inflation now stands at 14.89 per cent.

But the CBN December Business expectation survey reports that respondents firms expect the naira to further devalue while slamming the government on the control of inflation. 

“At -15.2 index points, the overall confidence index (CI) on the macroeconomy was pessimistic in December 2020. However, respondents are optimistic in their outlook for the month of January 2021 with a confidence index of 29.4. They also expressed optimism in the overall business outlook for February and June 2021 as shown in greater confidence of the economy with 39.2 and 55.2 index points, respectively 

The survey said pessimism on the macro economy in the current month was driven by the opinion of respondents  from agric./services (-10.4 points), wholesale/retail trade sectors (-1.7), construction (-1.6 points) and manufacturing sectors (-1.6 points). The major drivers of optimism for next month were agric./services (16.8 points) and manufacturing sectors (10.3 points). 

“Further analysis revealed that businesses that are neither import and export-oriented (-9.5 points), both import and export-oriented (-3.4 points), importers (-2.0 points) and exporters (-0.2 points), drove the negative business outlook for the month under review.

“Respondents from three sectors of the economy expressed optimism on their own operations in the review month with a confidence index of 3.2, 2.5, and 0.2 for agric./services, manufacturing and construction sectors, respectively. However, wholesale/retail trade sector was pessimistic at -0.3 index points  

On access to Credit and Installed Capacity, respondents’ outlook on the volume of business activity, average capacity utilization, the volume of total order and financial condition (working capital) were positive at 39.2, 11.2, 8.2 and 5.3 index points respectively, in December 2020. 

“Respondent firms’ opinion on the volume of business activities indicated a favourable business outlook for January and February 2021 with indices of 47.7 and 55.0, respectively. Businesses also hope to employ in January and February 2021 as the outlook was positive at 18.5 and 21.5 index points, respectively.

The break down by sector showed that the Agric and services sectors with (20.5 points) has the highest prospect for employment in the next month, followed by construction sector with an index of 17.9 points, manufacturing sector (16.7 points) and wholesale/retail trade (13.4 points)

Respondents were also optimistic about the volume of business activity and employment outlook index in the next 6 months as all indices were positive. An analysis of businesses with expansion plans in January showed that the Agric/services sector and construction sector have the highest disposition to expand with 52.9 index points each. 

The survey further stated that Manufacturing and Wholesale/retail sectors had an index of 46.6 and 41.2 respectively. 

“Respondent firms identified insufficient power supply (68.3), unfavourable economic climate (65.7) competition(64.8), high-interest rates ( 64.5) unclear economic laws (62.7), financial problems (61.9), unfavourable political climate (59.4), access to credit (53.1) insufficient demand (49.3), lack of equipment (41.5) lack of materials input (41.1) and labour problems (27.87) as major factors constraining business activity in the current month 

On the expectations on Exchange Rate, respondent firms expect the naira to depreciate in the current month and next month but appreciate in the next 2 months and next 6 months, as their confidence indices stood at -24.1, -3.8, 9.9 and 30.5 index points, respectively.

“Respondents anticipate an increase in economic conditions as the index on economic growth rate in the short run stood at 5.9, 19.2,27.6 and 41.9 points for the current month, next month, next 2 months and next 6 months, respectively. Respondents anticipate an increase in economic conditions as the index on economic growth rate in the short run stood at 5.9, 19.2,27.6 and 41.9 points for the current month, next month, next 2 months and next 6 months, respectively. “

Some Nigerians shared their views on the price of food items during the Christmas period, vis a vis, how they would cope during the new year. 

A Sales Representative, Frankly Eze who spoke to  Standard Gazette on the prices of goods during this yuletide period said it’s being though the mercy of God that he and his family are alive to witness the Christmas celebration.

Mr Frankly Eze said the prices of goods in Ikotu axis of Lagos have gone up astronomically, as food items in the market have become scared.

“Everything has gone up and going to the market now is something else. A bag of rice now sells for N27,000 or more depending on your location. Salaries are not enough anymore. Transportation is another matter and the family must survive and move on. The children must eat and put on nice clothes especially during this period of celebration. There is no excuse to give to the children, they have to eat and get new clothes.

Asked how the family would cope after the new year, especially with school fees that usually herald the resumption of schools, he said: “Personally, I am praying for schools not to resume in the new year, because I won’t be able to pay my children school fees. As a matter of fact, I am still indebted for last term school fees.

“I am praying for schools to remain closed for some time, after all, we are hearing of the possibility of another lockdown due to COVID-19.”

A human Resource Personnel, Mr Andy James noted that the high price of food items is nothing new, especially during the Christmas period.

“It is now a trend that food items must go up during Christmas season. So it’s not new. We are just pulling through by the grace of God. We now live from January to December trying to survive and as usual, we will start again in January 2021, hoping God keeps us alive,” he told Standard Gazette.

He added, “These days, we don’t call on the government anymore to help us, because Nigerians have lost hope on the government. We can only depend on God.”

On how he intends to pay his kids school fees in January, Mr James went spiritual saying, “the children school fees would be paid. The same way God has been providing, he will provide for us again in 2021. 

But there was totally a different perspective when Standard Gazette Correspondent spoke to an educationist, who said it’s all about planning.

Ms Bose Adeyinka said; “As for me and my husband, we have been particular about the number of kids to have. We currently have one son, who is four going to five and taking care of him has been tough with the current economic situation in the country. His school fee is N85, 000 a term and food and others are not there yet. 

“So what we do is to plan and have enough before we can decide to have another child. We are living within our means and income. The government would not help us take care of our family, so we must plan as a family. The economic situation is threatening our lives and what do you do? You apply wisdom and raise the family you can take care of. Not expecting the government to do that for you. 

Adeyinka continued, “Go to the market today and see for yourself. It’s alarming. I wonder how bigger family cope. I learnt the inflation has gone up again and our naira has lost so much value. It’s only God that will help us in this country. But the family must start planning to forestall lamentation.” 

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