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Economic Contractions Might Push Nigeria Into A Hunger Crisis

Key indicators on Nigeria’s economic development suggest an increasing percentage growth in hunger levels by the end of 2020, amid the speculations for a possible recession.

At the beginning of the year, the Nigerian economy was hit by the coronavirus tsunami, which suspended all economic activities for four months before a gradual reopening of sales and transactions in June.

The Federal Government resorted to a total lockdown after cases recorded in several economic hubs like Lagos, Rivers, Ogun, Delta, Kaduna, Kano and FCT began to increase. It is important to note that these states top the list for highest internally generated revenue in the 2019 National Bureau of Statistics (NBS) report.

This development, in turn, led to the increase in agricultural food products, services, household relief materials and transportation as manufacturers, farmers, local entrepreneurs and marketers began to produce and sell at much higher prices.

A representative from Corporate Farmers International who spoke exclusively on the impact of restrictions in the agricultural sector said: “The lockdown directives led to the shutdown of many businesses, especially those that cannot be performed from homes, which includes the farming business.

Poverty HeadCount Rate and Indices

“A lot of farming activities, including production, stopped as a result of the lockdown and so this affected a lot of businesses. Hence, the nation’s economy is adversely affected. With no production of food or transportation of already produced commodities people might just die from hunger faster than the virus itself.”

Samson Ogbole, Lead Trainer, Soilless Farm Lab, added that: “With over 40% of the population being in the agriculture sphere – whatever affects the ability to produce will invariably affect the ability to provide food, this will increase the level of hunger and with the rainy season being inconsistent (climate change impact) and lockdown stopping farmers from farming, this means the food price will definitely increase and thus increase the pressure on the poor and have a direct impact on the life of everyone. Hunger in my definition isn’t just the absence of food, for some, it is not having the right nutrient or having to over depend on unhealthy foods just to survive thereby compromising the immune system and leading to higher disease vulnerability.”

Hunger Level Assessment, 2017 Till Date

Despite gradually leaving a recession in 2017, Nigeria’s hunger statistics rose to 13.40 per cent on population growth of 190.9 million according to World Bank’s data. This was a 1.9 per cent increase in the ‘recessive’ economy of 2016 (11.50%).

However, from 2018 to 2019, Nigeria faced a multitude of crises ranging from insecurity, local conflict and attacks on homes, farms and residential areas. These transcended to the displacement of 1.9million persons in the Northeast, the epicentre of the crises.

Hunger Index in Nigeria

At the end of 2019, with a 2.6 per cent growth, the estimated population of the country was nearly 200 million. After indicating factors; child mortality, undernourishment, child wasting, child stunting, Global Hunger Index ranked Nigeria 93rd out of 117 qualifying countries that suffer serious hunger with a 27.9 scorecard. This is a 2.4 increase from 2017.

Nigeria, despite having the largest economy in importation and exportation in Africa, has steadily increased in hunger levels from 2017 till 2019.

Recent data published by the National Bureau of Statistics in 2020 show an economic contraction as the World Bank and Minister of Finance, Zainab Ahmed, predict that the country will go into recession by Q4 2020 after experiencing a crash in oil prices.

Nigeria’s economy contracted by -6.1% year on year in the second quarter of this year compared to its 1.87 per cent growth in the first quarter. Details on the economic contraction came barely a week after reports on unemployment rates which showed that 27.1percent of Nigeria’s labour force (21.7 million) are unemployed while 28.6 per cent are underemployed.

On the poverty scale, 82.9 million Nigerians are considered poor by national standards in 2019, representing 40.1 per cent of the total population who live on 137,430 Naira per year. 

In August, the Consumer Price Index, which measures prices of goods and services, hit 13.22% compared to the 12.13% recorded in January 2020, a 1.09% increase following a 29-month steady rise. 

Recall that President Muhammad Buhari closed land borders in August 2019 to control smuggling activities from neighbouring countries. The expected effect of this action was to strengthen Nigerian agricultural production. Instead, inflation rose in the country. In August 2019, the inflation rate was 11.02%, a 2.20% increase in August 2020 after a one-year assessment.

Similarly, the Food Price index in January stood at 14.85 per cent and rose to 16 per cent in August 2020. In a recent development, the president ordered the apex bank not to allocate foreign exchange to importers of food and fertilizer.

Indicators for Hunger Index in Nigeria

When placing these data alongside each other, out of an estimated population of 200 million, approximately 90 million persons are poor and living on N137,430 per year. In a month, a poor Nigerian spends roughly N11,295 and approximately N377 for each day.

NBS revealed that 1kg of rice sold at N389.21 in January 2020 increased to N413.133 in August 2020. Also, 500g sliced bread sold for N302.45 in January 2020 increased to N312.742.

With a 1.15 per cent increase in food prices, a random poor Nigerian who spends N300 on a daily meal in January would be spending N345 on the same meal. On enquiry, in January, a satisfactory homemade meal (Rice and stew) would cost N1040 in January, while in August, N1196 with the same ingredients.

This estimation shows that a poor Nigerian would have to live above expenses to feed himself daily.

The rise in inflation and food prices are not unconnected to the hike in fuel, electricity tariff, household materials and transportation expenses.

With persistent growth unemployment and poverty compared to the estimated population growth by 2020, without proper intervention, Nigeria’s economic recession speculations might equally be greeted with a food crisis in 2020’s NBS report.

This story was supported by the US Embassy via the ATUPA fellowship by Civic Hive

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