The prediction of the World Bank that more Nigerians and their sub-Saharan neighbours will fall into extreme poverty is a cause for worry. According to the World Bank, Russia’s invasion of Ukraine has affected the commodity market, supply chains, inflation, and these factors have slowed down world economic growth. World Bank President David Malpus stated that: “The global economy is facing high inflation and slow growth at the same time. Even if a global recession is averted, the pain of stagflation could persist for several years – unless major supply increases are set in motion.”
At home in Nigeria, these global challenges are exacerbated by insecurity and mismanagement of available resources. No doubt, the impact of terrorist organisations, separatist groups and the criminal herdsmen masquerading as pastoralists have further worsened the national food crises, which is driving more people into extreme poverty. In the north eastern and the middle belt parts of the country, its major food baskets, farming has become endangered because of the war by Boko Haram, and criminal pastoralists, who invade agrarian communities at will.
There is also the challenge posed by corruption in government circles. While no doubt the President Muhammadu Buhari government has made some strides in infrastructure development, a lot more work needs to be done before the impact can be felt. Again, while the government has engaged in several agricultural interventions like the Anchor Borrowers Scheme, which has impacted positively rice production in the country, the nation still depends substantially on food importation.
There is also the debilitating poverty arising from inflation and decreasing production capacity amongst industrialists. With food prices rising astronomically, the disposable income of the populace continues to diminish, and consequently their purchasing power. With more resources chasing fewer goods, the value of the national currency continues to plummet. This inflationary pressure is made worse by the high cost of production, as electricity, fuel, diesel and other influencers go beyond the reach of most producers.
The result is economic stagflation, which means “persistent high inflation combined with high unemployment and stagnant demand.” So, with inflation hitting the roof, while many are unemployed, the result is increase in crime and social delinquency. This grave situation has been compounded by real and perceived marginalisation, as those in positions grapple with managing the scarce national resources. With the resultant economic imbalance, there is disenchantment with the status quo, and increased social upheaval.
So, the prognosis of the World Bank is real, and unless those in authority grasp the grave danger ahead, and device measures to deal with the challenges, Nigeria and indeed her neighbouring countries would suffer the dire consequences. Tragically for Nigeria, economic activities are not expanding to match the growing population, resulting in high youth unemployment. According to the National Bureau of Statistics, youth unemployment rate in the fourth quarter of 2020 stood at 53.40 per cent.
The challenge for those in authority is not just how to manage the inflationary pressure, but how to create employment, and energise economic growth at the same time. While that won’t be an easy task, it is the only way to contain the likely restiveness that can only further create more national challenges. With politics taking the front seat, and governance receding to the back bench, the nation needs to raise statesmen to avert the economic quagmire, as predicted by the World Bank.
For Nigeria to avert crisis, governments at all levels must resist the temptation to sacrifice economic challenges on the altar of political gerrymandering. The dire warning of the World Bank is grim: “More people in Sub-Saharan Africa are expected to fall into extreme poverty, especially in countries reliant on imports of food, and fuel.”