An Ordinary Man’s Understanding of Nigeria’s “Technical Recession”

A Nigerian market scene. Picture Source / Thisdaylive.com
A Nigerian market scene. Picture Source / Thisdaylive.com

On Thursday July 21st 2016 Nigeria’s Finance Minister, Kemi Adeosun revealed that the country was in a “technical recession” while addressing members of the senate.

A bag of rice as at last year cost about 7,500NGN – 10,000NGN, but presently a bag of rice in the country ranges between 16,000NGN – 19,000NGN doubling its former price as compared to last year. Virtually every commodity in the market is experiencing a price hike almost twice its previous price. Many states in the country cannot pay its workers’ salaries, while basic infrastructural projects like road maintenance, provision of pipe borne water, and maintenance of medical facilities in health care centers have been suspended in most states.

In addition to this many private companies as well as public institutions have deployed different mechanisms in laying off staff in order to keep such companies or government parastatals running.

According to the national bureau of statistics it was reported that over 22 million people are unemployed. The report shows that the total number of persons with full time employment decreased by 1.29%. It was also reported that the number of underemployed people in the labor force increased by 9% resulting to a staggering 14.42 million people in the fourth quarter of 2015 without a job. Within the same period unemployment rate increased massively.

Many Nigerians cannot afford eating three square meals before the government declared “technical recession” and as it stands now its unarguable that 80% of Nigerians might not be able afford two meals daily as the price of basic commodity has sky rocketed, while unemployment and nonpayment of salaries is prevalent in the country.

All this could be attributed to corruption of the past administration as postulated by the current government, non-diversification of the economy, fall in prices of crude oil worldwide, and mismanagement of government funds. However, some pundits argue that the insensitivity of the current government to put fiscal policies in place to alleviate the suffering of Nigerians also contributes to the current deplorable state of the economy.

It’s applaudable that the Nigerian government is trying to sanitize the country but that should be done hand in hand with a vibrant economy, while unemployment should be on the downtrend and the welfare of the employed should be looked at and improved upon.