A new report by the World Bank said that Federal Government’s poverty reduction efforts have been hampered by sluggish growth, low human capital, labour market weaknesses, and exposure to both domestic and external shocks. In the report entitled: “A better Future for All Nigerians/Nigeria Poverty Assessment 2022,” it bemoaned the deepening poverty scourge in the country, stating that four in 10 Nigerians live below the national poverty line. This means that about 80 million of the 200 million population are currently trapped in poverty net
The latest report represents the culmination of the bank’s engagement on poverty and inequality-relevant data and analytics in Nigeria in the last two years (2020-2021). The report was based on the 2018/19 Nigerian Living Standards Survey, which provided the country’s first official poverty numbers in almost a decade, as well as the Nigeria COVID-19 National Longitudinal Phone Survey. These surveys had been implemented by the National Bureau of Statistics (NBS) in collaboration with the bank.
The new report also brings together fresh evidence on the profile and drivers of poverty in Nigeria, and revealed that Nigerians living in the northern parts of the country are worse off, they lack education, improved sanitation, and access to basic infrastructure, such as electricity, and safe drinking water, among other necessities. Besides, the global bank noted that only 17 per cent of Nigerian workers “hold the wage jobs best able to lift people out of poverty.”
Therefore, it suggested that deep structural reforms are urgently needed to lift millions of Nigerians out of poverty. These include boosting health and education, bolstering productive jobs, and expanding social protection, creating macroeconomic reforms, including fiscal, trade and exchange rate policy, with emphasis on diversification of the economy, from farm and non-farm household enterprises, as well as access to electricity, clean water and sanitation.
The report is timely and the government should address the observed challenges. The fact that Nigeria remains the poverty capital of the world is distressing. Unfortunately, the government has not done enough to fulfill its promise to substantially reduce poverty. President Muhammadu Buhari had some months ago promised to lift 10 million Nigerians out of poverty every year. Instead of that being done, more Nigerians have reportedly fallen into the poverty hole. On May 2019, the President was widely reported to have said that Nigeria’s level of poverty upsets him.
According to him, “when I drive around the country, what upsets me more is the status of poor people in this country – you see young people, the so-called Almajiri with torn dresses, with plastic bowl. They are looking basically for what to eat…” However, lamentation is not enough. Concrete action is what is required to lift millions of Nigerians out of excruciating poverty. At less than 2 per cent annual GDP growth, the economy is not likely to witness sustainable growth. Sadly, most Nigerians are living in extreme hardship and misery. Moreover, Nigeria’s poor human capital development ranking is troubling. Recently, the World Economic Forum ranked Nigeria 127th out of 130 countries in the survey. Given our profile as the largest economy by GDP in Africa and the vast human and natural resources that abound in the country, the World Bank report is on point. The active youth that make about 55 per cent of the population need to be empowered to get jobs.
Currently, the rate of unemployment is over 35 per cent, and inflation is surging. It is most unfortunate that in almost every area of socioeconomic and human development, we are either at the bottom rung or close to the bottom rung of the ladder. Whether in the life expectancy, human misery index, access to potable water, sanitation, healthcare, or basic education, Nigeria performs poorly. The World Bank report is in sync with the latest report by the Nigeria Economic Intelligence Unit (EIU) which says that Nigeria’s economic growth will slow more than expected this year as power supply issues, high inflation and monetary tightening by the CBN will hurt output.
From an initial forecast of 3.3 per cent in February, the EIU says it expects real GDP growth to decelerate to 3 per cent in 2022 from 3.6 per cent in 2021. The EIU forecast is less than the World Bank and IMF’s estimate of 2.7 per cent and 2.5 per cent growth, respectively. This stems from the continued erosion of household purchasing power and other challenges such as high food prices and high cost of petrol, diesel and cooking gas. The government should stop living in denial. The economy is in bad shape and in urgent need of urgent restructuring.
Manufacturers are threatening shutdown and job cuts as a result of high cost of running business. Last week, the CBN Governor, Godwin Emefiele, said available data on key macroeconomic indicators point to likely subdued output growth for the economy for the greater part of the year, with dampening impact as a result of rising energy cost and tightening of external financial conditions and the persistence of insecurity across many parts of the country. For the economy to rebound, there is need for rapid reforms, fiscal discipline, and reduction of food inflation, unemployment and cost of governance.