Nigeria: What's behind the currency crisis and rising food insecurity?

this week on the 77% Street debate we had election a couple of months ago and the next thing is uh the removal of subsidy everything is just just too expensive I have to just pick up three jobs to be able to meet up how are we sure that these people that made up the cabal are not the same persons that will still handle the resources you need to ask yourself do we want roads or do we want to be able to buy cheap whe sorry what's wrong with having all of [Music] it hello and welcome back to the 77% this week we are in Nigeria and this country's president when he was elected on 29th May of 2023 inherited an economy in Dire Straits in the month since he's been in power Bola ubu has tried to take measures to uplift or resuscitate that economy but the young people of this country are saying that their pockets are still not able to sustain what the country is demanding and so today we are asking is the government able to come to their aid when they're in crisis so let me start this conversation by introducing tji Andrews who's an economist uh can you just paint a picture of what the economy looks like right now inflation is really high uh the dollar to the Nara is um is now close to a th000 Nara it used to be uh 200 Nara maybe another 6 years ago um so you can just imagine what it is the effects on the average everyday person's pocket so it's it it is a situation where a lot of people are really going through it and um it doesn't look like there is any um Hope on the horizon because the government in trying to you know get the funds to be able to fix the issues are also removing things like subsidies on petrol uh subsidies on gas subsidies on electricity so it's making it the more difficult for Nigerians to actually exist okay so because you've introduced the question of subsidies let's talk about it right uh so the the government recently in this country removed fuel subsidies which made uh the cost of fuel basically triple overnight uh so first of all before we continue tell me what the situation with the fuel was before the subsidy removal um I think it was 197 na to the dollar uh and now it's about it's close to 500 hour so more than about tripled so there was controversy around uh this uh subsidy right uh let me come to you Martin um the subsidy removal is essentially um the kind of paliative that government has been giving to everyone in the country in terms of um to help um reduce the high cost of um petroleum products you know um however the government decided to take it out um in order to have more money to the excuses to have more money to carry out Developmental and capital projects but the question therefore is are they really going to do that in terms of implement projects with whatever money that comes in from subsidy removal another question one person might have is why is Nigeria a country which is one of the highest oil producing nations in Africa needing an oil subsidy uku help me understand this we have 133 million Nigerians living in poverty and then this is too high for a country like Nigeria that is blessed with so numerous um um natural and Human Resources so the government need to come to your a is a bad thing for government to subsidize them f for Nigerians but the question here is that how sustainable is it going forward okay so because you spoke about people living in extreme poverty uh one of the reports I read said that 12% of the population living in absolute poverty is here in Nigeria and that really surprised me Ida are you seeing a difference since uh you know as life is getting tougher for people and you're a journalist and you're covering these issues what is changing in the in the society now that first subsid has been removed it's affecting the cost of production an entrepreneur that needs that has little Capital now can cannot even that capital is not even enough to do his business so it gets worse now people the the gap between the poor and the rich is widening yeah people that used to be in the middle class I've gone now to the lower class because of this change this so-call change something that was supposed to help us has made everything worse okay let me hear from the people in the audience how has your life changed in the last couple of years are you feeling the economic burden DJ pretty talk to me everything like when you go to the market to get anything you want everything is just just too expensive the house rent has increased we at stay I used to pay 1.5 on the island uh but now they've increased it to 2 million landlord the caretakers they don't care they all need to survive too I understand that part but then where do we get those money from I have a son I have to feed my son I have to I have to just pick up three jobs to be able to meet up all right B you wanted to say something to me we just come out of coid 19 and we all understand what happened during that season a lot of Nigerians lost job you know a lot of um organization in there to close down because they they um they couldn't continue to operate but then all these were not considered at all so um we just we had election couple of months ago and the next thing is uh the removal of subsidy and of course you may want to have the question that okay before this period what did governments put in place what are the system governments put in place to be able you know to help the mass at a time like this but then there is nothing nothing has been done yeah uh but B while I agree with your points I wonder and I I'd like you to answer this for me because you're in politics is it too soon to be judging the government they've only been in power for a couple of months they're saying give us time and you might be able to reap the benefits what do you think of that I mean the moment you said I was in politics I had this heavy stare look at me um so I'm in opposition politics um and member of the youth party so I'm literally in in opposition um the reality is that the government must first admit that its political party's mismanagement of the economy has created a situation which has led to the foil subsidy um removal um the argument that they have made is that it is driven by theft and the fact that they cannot fund projects but unfortunately you haven't pursued these criminals who have been stealing from our Commonwealth and there has hardly been any prosecution of these so-called criminals so you've passed the buck and that responsibility of your inability to deal with the theft in the subsidy scheme to innocent citizens who now have to pay three times more um for every other thing that they have been dealing with um so living expenses have skyrocketed because the biggest price shock that any economy can take it's his energy right it's it's a topsy Topsy Turvy situation where we seem to be um giving the devil a shake on one hand and pretending that we're trying to kill it so it's a problem for us okay I want to hear from uh alib Bob because you're working with communities at the Grassroots right uh how is that manifesting on the ground this just came to us as a shock um at the at the inauguration President announced it that same day prices of everything skyrocketed people that live in rural communities and the truth is right from time they always they've always be um bear the bond of the fuel subsidy regime because while the government claims to subsidize Fuel and um Energy Products they don't really enjoy it because people in the grassroot still buy for more expensive than people in um urban areas why is that so people in urban areas buy the foil directly from petrol stations they go they can easily access it but people in rural communities get it from like third party buyers they sell it to them in Jans gallons and all of that So eventually they've been buying foil in rural communities for 250 n 300 n while the rest of country was buying for less than 200 N people from the Royal communties have to cater for themselves people I work in IDP camps and Rural communities they benefit largely from the Goodwill of people but there's no Goodwill to give anymore the people that will commonly just wake up and say oh let's go to this camp and share things for them they can't even afford to take care of take care of themselves so imagine what the people in these communities have to deal with is a very serious situation and I think the problem does not come from removal of subsidy every well- meaning Nigerian understands subsidy has to go but now the mode of which it was removed there were no proper structures put in place it's almost two months later or 3 months later we've not had a conversation about national minimum wage that's something that would have been able to touch everybody across yeah okay let's talk about it right ID you're nodding the minimum wage in this country Still Remains at uh 30,000 naira which for me was very shocking because that's literally $1 or at least just about a dollar every single day uh you were nodding earlier why was that the minimum wage is still 30,000 NAA what systems have you put in place to make sure that the people you are ruling over are not feeling the brunt of all this of your strategies in quote uh okay few months back they said we're going to um make public transport in Lagos they're going to reduce it for people it's just all paperwork we don't see we have not seen the action some people don't even have up to that don't even get up to that 30,000 NRA how do you expect them to survive in an economy that's like this so uh because we spoke about the minimum wage earlier tundi I want to come back to you and ask is it even realistic even if the government was to say today all right we're increasing the minimum wage people just can't afford it I've heard a lot of the things that have been said um from a lot of the people and um there needs to be an understanding of how economies work and and um for there to be expenditure there needs to be Revenue um and the main source of revenue for Nigeria is crude oil at this particular point we have issues around uh production due to theft and all many other things but generally we have never met our Revenue expectations maybe in the last 10 years I don't think we've met it once no you haven't uh you're still not meeting your daily obligation to OPEC of 2 million barrels absolutely so the the the Challenge and the question starts to come and you you need to ask yourself what's the tradeoff do we want subsidy do we want to build the economy do we want roads or do we want to be able to buy cheap fuel do we want cheap electricity or do we want to actually improve our economy now the truth is sorry what's wrong with having all of it yeah well you see the thing is when maybe 10 years ago we could afford to do both when crude o was $100 per barrel and over and uh the den president was trying to remove uh fuel subsidy at the time and a lot of the people possibly watching us and maybe even in this panel went all the way to AJ to protest not to have it removed 10 years after trillions of Nara wasted down the line and now we've removed it and people are still saying do not remove it for me it's something that is possibly a decade and a half too late okay now the question of course is because people generally do not understand understand this things I think the government could have done a better job in explaining it but is it the right thing to do absolutely we were wasting money to let me explain it right my petrol tank I feel it now about 28,000 I used to fill it then with about 8,000 right before subsidy was removed 8,000 is pretty much about a meal for me right pretty much about a meal um 28,000 now is still not too too excessive but it's a it's a huge jump right I have more than one car I tend to fill the tank hey my point is my point is if you are keeping subsidy for the people at the bottom of the pyramid who do not have one and do not enjoy this excesses that I'm talking about then what's the point my because I'm buying fuel at I'm filling my tank at 8,000 doesn't mean I'm going to now go and give excess to somebody on the street I am still going to keep that money with myself so if the government sees the right thing to do is to remove this so that they can create infrastructure I think what we as Citizens need to do is engage them on that conversation on where is the gap and what are you using the Gap to do as against do not remove subsidy all right so okay let let's come here there's some burning points okay so they can generate revenue from Customs they can generate revenue from taxes they can generate revenue from marine or Maritime sector and a lot of other things that you can actually do and even if you block the loopholes I said something about corruption which is essential all the presidents that have attempted to remove subsidy in Nigeria would tell you there's a cabal what the hell is a cabal is a cabal bigger than an Administration the president or the government of Nigeria that you can't bring to Justice and then allow the poor breathe like the president said okay let me come back to the person who introduced this word cabal uh so it's obviously a system that is plagued with very many problems why should you then enter trust the same system to resolve the issues well um so truth be told right I want us to think differently you know about subsidies Europe is taking a more isolationist stance towards driving factories into their own economies and decoupling from China the Americans for instance just passed an inflation act where they're going to be spending $460 billion um on Alternative Energy and subsidizing electric vehicles they want to attract factories back home right my argument is how do you power productivity locally it's impossible to power productivity when yesterday the price of diesel is a th000 Nara per liter we're fooling ourselves right so if if the cost of energy continues to hit the roof we'll continue to create poverty upon poverty and it makes it almost impossible now for FD to come in because nobody has the spending power to buy whatever they going to be producing I agree that there has been waste over time I agree that there has been teed over time but I think again that we have to look critically at the biggest price shocks and how we can manage them right so uh but you've said something really interesting which is that uh the knock on effects of this it's driving people into desperation into serious serious poverty anybody else want oh who whoa you were just holding waiting okay let's hear from you yeah so speaking about the issue of crime as regards to foil subsidy I think we need to put the spotlight also on large scale crimes sometime in June 2022 the MD of nmpc limited made Nigerian National Petroleum Comm Corporation limited which is now a company now the MD indicated that uh the daily consumption of foil is now about3 million uh liters per day and now he also indicated that about 53 million of this uh 103 million per day is actually being stolen so that's actually a large scale crime these things are carried out there allegations here and there about high ranking individuals perpetrating these crimes and may or may not the government may or may not know about it or may or may not involved so just to bring the conversation back to Center we've spoken about what is happening on in the country and uh the effects this is having uh but tundi I'm coming back to you with the same question I started with why is this happening in Nigeria you know we how is it possible that we're still talking again subsidizing fuel in an oil reach country those two things don't seem to belong in the same sentence the general context is when an economy is in a bad State like the one Nigeria is in uh from years and Decades of you know bad mismanagement you know policy mismatch you know Brazen theft it will need to take some hard hard decisions Nigeria has gotten here not by one decision not by one bad president it's gotten here by several Bad actors come bringing us here continuously what we are experiencing in terms of high inflation bad roads bad infrastructure is something that has decayed over two decades or three decades to be to be real so it's not something that we can flip the switch and change around so the question is what do we do to fix it if we're really as um excited or really as uh passionate about making Nigeria better I think the real job is in holding government accountable hold on let let me actually ask the person who's in opposition how do you hold the government accountable you you are relaxing here waitting you I mean we're joking you can't hold these people to account what's the point I give an example there's a local government chairperson in oun state um who is in prison today um he's been arrested detained by the DSs today he was arranged um you know he's been manhandled for the last 3 weeks because simply asked for the allocation that is due to his local government right and he's been he's been he's been locked up so the people shouting let's hold government accountable are just singing songs you can't hold them to account they are still driving their long their SUVs with their convoys they're still flying first class they're still appointing hundreds of AIDS and flying them across the world for meetings so we're joking so if it's really a joke why are you in opposition politics if you really think nothing can change first my argu argument is we need to begin to think in our own self-interest as Citizens because the politicians take care of themselves every time 7 days a week twice on Sunday we have to think selfishly for ourselves and understand where our own self-interest lies that's why I'm excited about the young people who are fighting um for low school fees they are pursuing their own self-interest because the politicians will always take care of themselves let me hear from uh give me a second let me just give me a second to to hear from Martin because you mentioned self-interest and Martin has actually been arrested for criticizing the government correct um so correct that's correct but I I want to totally disagree with IO because um when you talk about accountabil he's even removed his glasses it's serious now when you talk about holding government accountable we've seen a lot of progress in terms of holding government accountable so for example let's even start with the Gen Z and their latest Pro U protest in terms of nsas nsas held the the Nigerian government and put them on a stand still for them to at least get to a point where there was a little bit of reform in the Nigerian police what we are doing here and expressing ourselves if Government listens we are also holding government accountable saying listen the subsidy you removed you you did it in a very bad and hogwash way you should have fixed refineries first of all so that we can produce petroleum locally and then sorry to interrupt you but you brought up refineries are they working at the moment there's no Refinery that is working working in Nigeria except which is below capacity which is below capacity now if you fix refineries we can produce F locally and it will then help to bring the forces of demand and Supply into play in such a way that the forces of demand and Supply will then dictate the prices of petroleum products which will now make it easily affordable for people but you didn't do that you remov subsidy you spent a lot of money in dagot refineries light to us again last year that the refinery would work this year and we haven't seen that happen you can't therefore say that accountability we should fold her arms and then watch government continue to do what he doing because for example including the first subsidy in 2012 removal of subsidy in 2012 Nigerians marched on the streets and government was held accountable and people did a couple of things people get arrested and there's a huge public outcry and government says okay we are going to to reverse this decision so as citizens of Nigeria understand that our power is still very very useful and if we continue to use our voices to tell the governments that this is what we want and we disagree with your policy this particular policy that you're implementing Nigerian government will have no no other reason than to listen and to stand still okay so I like that because it brings us really nicely into some solutions right we've talked about some of the problems and how they're affecting the society but if you had had the chance to be in those top offices today what would you do to change things around I want to hear from some of the younger people first uh that it's giving gen Z let's hear what you have to say so I also feel like encouragement of public opinion because I recently heard that he was arrested for criticizing the government okay so we as Citizens we are we do not just have that intention to just sit back and fold our arms whenever we see things disagreeable especially with the government's actions we should also be allowed to speak allowed to share our opinions we should not be condemned because of we feel like um we have um better opinions or better interests or just some solutions so whenever we you know there's something known as constructive criticism and I feel like we as citizens should be allowed to constructively criticize the government government without being condemned so encouragement of public opinion can also be um you know used to enhance this um problem because this is a Democratic Society we practice democracy we are not under dictatorship we're not under narcism okay so we should all be allowed to like share our views and opinions without being arrested or condemned yeah I also yeah I also think that the government should um look into uh creating more uh um manufacturing Industries yeah and then maybe subsidize them too and then open the borders for exportations that with that too you create more job opportunity for the Youth and make more money to exporting Goods out yeah Dr I wanted to add to what she said said yes um manufacturing industry make more manufacturing industry so that we can now export which is a beautiful idea but before that how about reducing import duties it makes sense to do that so that you can reduce the burden on people and I also want to add we have said we have said a lot about accountability and I don't want to but transparency too is very important we need to know what's happening okay you've reduced the you've removed the F subsidy which is beautiful and it say said something about the cabal how are we sure that these people that made up the cabal are not the same persons that will still handle the resources how sure are we so these are issues I'm going to to all of you um so talking about public trust I think it's it's quite straight forward no just like make people feel like they matter like okay like this thing is in your hand protect it make it work so when you're talking about F subsidy we're always um reactive not proactive you're trying you planning to remove subsidy okay these are the steps we are taking national minimum wage will be increased and we create avenues for CNG bosses talk to people engage with people we are human beings eventually everybody wants Nigeria to work there's nobody that settling down somewhere and says I do not want Nigeria to work so we are trying to remove subsidy you have ministers you have local government chairman you have counselors you have House of rep members send them back to their communities let them engage with the village Chiefs with the people tell them when they explain to them then they'll give you a brief window to perform once you engage make everybody feel like they have a piece of the cake they will come down okay uh byy you know there is a system that make it look like the leaders are H there and the public are down there whatever they saying is a business we don't care about it so that it looks like there is a kind of body they are building and whatever we are saying as public as Citizens as youth it look like a threat you know to their body it look like a threat to their office it look like a threat to their position so we need to remove that orientation we need to change our ideology there should be understanding between the uh the the leaders and the people they are leading so we need to eliminate that we need to remove that and there should be you know Mutual understanding and um what what the the the public is saying should be considered as need and not should to be seen as threats okay uh and finally T my issue with government continuously is a i there's a Nigerian Parliament where we say we need to pick our hustle this government comes in and decides we're going to be semi socialist this government comes in and says we're going to be completely Democrat this it's it's always a mismatch today we are facing this way tomorrow we're going this way next tomorrow we turn and we go down the middle it's a continue pick one decision and and stick with it but the people the people which which is the most important factor in this entire conversation need realize that the people who are in government are not gods they came out from us they need to be held accountable okay I think that is a beautiful place uh to wind up it was a very complex question that I asked but I think tunji has tried to sum it up really nicely and I don't dare add anything there for you for watching I thank you always and see you next [Music] time yeah

Channel: DW The 77 Percent

Views: 39,404

Keywords: DW, DW Africa, Africa, oil, nigeriaeconomy, economy, Nigeria, fuel, the77percent

Id: vRMni0KIxNA

Length: 26min 0sec (1560 seconds)

Published: Fri Nov 10 2023