He lamented the alarming rate of inflation in Nigeria, noting that despite that, Nigerian workers are among the lowest wage earners in the world.
Former Vice President Atiku Abubakar has said that one year of President Bola Tinubu’s administration has pauperised Nigerians.
He lamented the alarming rate of inflation in Nigeria, noting that despite that, Nigerian workers are among the lowest wage earners in the world.
Atiku was the candidate of the Peoples Democratic Party in the 2023 presidential election but lost to Tinubu of the All Progressives Congress.
In a statement issued by Atiku Media Office on Tuesday, assessing Tinubu’s one year in office, Atiku said, “First, President Tinubu’s policies do not create prosperity. Instead, they pauperize the poor and bankrupt the rich. They spare no one.
“Nigerian citizens, the majority of whom are poor, are going through the worst cost-of-living crisis since the infamous structural adjustment programme of the 1980s. The annual inflation rate at 33.69% is the highest in nearly 3 decades. Food prices are unbearably higher than what ordinary citizens can afford as food inflation soared to 40.53% in April, the highest in more than 15 years.
“Nigerian citizens have to pay 114% more for a bag of rice, 107% more for a bag of flour, and 150% more in transport fares relative to May 2023. Today, in some locations, motorists are paying 305% more for a litre of fuel. Yet, on a minimum wage of the equivalent of US$23 per month, Nigerian workers are among the lowest wage earners in the world.
“Tinubu had the ‘courage’ to remove subsidy on PMS and impose additional taxes on his people but lacks the compassion to raise the minimum wage or implement a social investment programme that would reduce the levels of vulnerability, and deprivation of workers and their families.
“Second, President Tinubu’s policies create a hostile environment for businesses, big or small. The private sector is overwhelmed by Tinubu’s dismal policies and overburdened by his failure to address the policy fallouts. The manufacturing sector, which holds the key to higher incomes, jobs, and economic growth, has been bogged down by rising input prices, higher energy and borrowing costs, and exchange rate complexities.
“For example, since 2023, the average price of diesel has doubled to N1,600 per litre. Electricity tariff has recently been increased by 250% from N68/Kwh to N206/Kwh. As reported by the Guardian (13 May 2024), in Q1 of 2024, energy prices were up by 70%, costing manufacturers N290 billion.
“Since May 2023, corporate Nigeria has lost more than a dozen enterprises to other countries. Unilever, GlaxoSmithKline (GSK), Procter & Gamble (P&G), Sanofi-Aventi Nigeria, Bolt Food, Equinor, among others had exited Nigeria citing reasons including foreign exchange complexities, security concerns, and high operational costs. According to the Nigeria Employers’ Consultative Association (NECA), nearly 20,000 jobs may have been lost due to the departure of 15 multinational companies from Nigeria.
“Those enterprises that remain are struggling to survive. Vanguard Newspaper (20 May, 2024) reported a significant rise – to nearly 30% – in unsold goods in the warehouses of manufacturers of fast-moving consumer goods, occasioned by the rising cost of living and declining purchasing power of the citizens.
“According to the Guardian, manufacturers reported in Q1 a 10% drop in capacity utilization, a 10% drop in production, a 5% drop in investment, and more than 7% drop in sales. The Daily Trust (1 May, 2024) quoted Dangote lamenting that nearly 97% of manufacturing concerns in Nigeria will be unable to pay dividends this year.”
Atiku noted that in an economy with a high rate of unemployment, a declining manufacturing sector cannot be an option.
He said, “Third, President Tinubu’s foreign exchange policies have not had any positive impact on Nigeria’s foreign trade balance, contrary to policy expectations. In particular, the free-float and the resulting devaluation of the Naira has not resulted in an appreciable improvement in Nigeria’s trade balance.
“Devaluation has not enhanced the competitiveness of local producers and has had no positive impact on exports of goods, primary or manufactured. In Q4 of 2023, for example, while imports surged 163.1%, exports rose at a slower 99.6%, indicating a huge foreign trade deficit.
“Similarly, in Q1 of 2024, Nigeria recorded a trade deficit of $7.5 billion, with export value of $12.7 billion and import value of US$14 billion. Overall, the trade deficit as a percentage of GDP increased by 0.83% from 0.05% in May 2023 to 0.88% in May 2024.
“Fourth, President Tinubu’s policies have failed to attract foreign investments into the country despite all the posturing and media hype by the President’s men. Exchange rate unification and free float of the Naira have not led to higher capital inflows (whether Foreign Direct Investment or Foreign Portfolio Investments), again contrary to policy expectations. Indeed, FDI inflows declined by 26.8%, from US5.33 billion in May 2023 to US$3.9 billion in May 2024.
“It is not difficult to understand why: FDI is about TRUST. It is about the investing world trusting the leadership of a country to act and deliver on promises made. Investors come when the right policies are designed and delivered timely and efficiently by public institutions.
“Finally, despite deploying various monetary policy tools, inflationary pressure persists, and so does exchange rate volatility. No thanks to Tinubu’s misguided policy, the Naira’s value plummeted against the dollar and has since become the worst-performing currency in the world.
“It is clear from the foregoing that President Tinubu has an exaggerated understanding of the efficacy of his policies and was not ready for the potential fallouts. Tinubu and his team are not exactly sure of where the reform process is and what the next steps are. Has Nigeria reinstated fuel subsidy? Is the Naira on a free or managed float? These trial-and-error policies raise questions about the readiness of the administration and their capacity to restore the economy to a path of sustainable growth.”
“Time is running out for the government, and Tinubu must act fast to save the economy,” he added.
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