Link: https://www.reuters.com/markets/nigeria-inflation-quickens-april-food-prices-surge-2023-05-15/
Nigeria’s annual inflation rose to 22.22% in April from 22.04% the previous month. Food inflation rose to 24.61% in April from 24.45% in March. The National Bureau of Statistics said, “The rise in food inflation on a year-on-year basis was caused by increases in prices of oil and fat, bread and cereals, fish, potatoes, yam …, fruits, meat, vegetable, and spirits,”. Following a 50 basis point increase to 18% in the benchmark lending rate in March, the central bank is scheduled to fix interest rates the following week. Expect price pressures and a weakening naira currency.
Nigeria is the largest economy in Africa but that being said its slow economic growth and its rapid inflation are factors new Nigerian president Tinubu must address. That will be quite the goal for Tinubu after the dispute of the election back in February. Nigerians don’t have much faith in the government due to speculation of Tinubu stealing the election as white Nigerian votes were a lot more electronically accounted for so it is possible the count could’ve been tampered with. Right now Tinubu needs to regain Nigeria’s trust and this is a perfect opportunity, depending what he does. Also, not to mention addressing the widespread insecurity within the country which makes it significantly more difficult to eradicate poverty and hunger. Thus prompting the Central Bank to hike their interest rates up, consuming savings and peoples incomes.
This ties back to a few things we talked about in class such as Nigeria having the biggest oil pubs. They’re rich because of their oil due to being an oil reserve for other major countries such as Russia. That’s why their economy fluctuates and goes down so often. So if they go down Russia and the Middle East go down. For example when we placed sanctions on Russia because of the war with Ukraine our gas prices sky rocket due to us getting gas from Russia. So similar things can happen to the other countries due to Nigeria being the biggest oil reserve in Africa.