How Inflation And Unemployment Is Fuelling Crime Rates In Nigeria

“We are all tired of the country. Nothing is working… most of our marketers cannot bring foodstuff because they are afraid of attacks. We now divide the yams into four to five pieces and sell one piece for N200 so people can buy. Let the government help us please”

This is the plight of Adamu Shehu, a yam seller at the popular Oyingbo foodstuff market in Lagos, Nigeria.

For Adamu and many other Nigerians, living in the country has become harder and harder every day as the country once the promise and pride of Africa heave under the weight of soaring food prices, unemployment and rising crime rates.

The Nigerian economy which is 90% reliant on the crude oil sale had barely recovered from the oil crash of 2014 before the coronavirus pandemic hit, driving the economy to its lowest in four decades.

In a Development Update Report on Nigeria, the World Bank revealed that the country’s economy was growing at a snail pace of 1.8%, projected to continue at an even slower pace compared to the population expansion rate of about 2.6% a year.

Nigeria’s slow recovery rate could only mean one thing for its citizens; population will continue to outpace economic expansion, adding more poor to the world’s poverty capital. Over 90 million people live in penury, more than India, which has a population seven times greater.

According to the World Bank, an additional 11 million people would be pushed into poverty by 2022 as personal incomes are at their lowest in four decades.

The president is not making things easier. Elected in 2015, President Muhammadu Buhari’s policy blunders is doing everything it can to chase away foreign investors the country needs if it is to survive.

Buhari’s policies on foreign currency for the importation of products and his refusal to fully ease exchange controls have crippled crippling businesses that can not get goods to survive.

To make things worse, his administration is seeking to regulate social and online media after indefinitely suspending Twitter that cost the country about N2 billion in 24 hours.

Policies like this have curbed foreign investment, pushed food inflation to 15-year highs and scared off companies such as South Africa’s supermarket chain Shoprite Holdings Ltd.

To make thing even worse, the government is living on borrowed money, with debt service costs eating up over 80% of its revenue.

Rise In Crime Rates

From December 2020 till now, bandits seeking ransom have abducted about 800 children from their schools in various raids across the northern region of the country. Some of the students have been returned to their parents, while others remain missing or dead.

Kidnapping in northern Nigeria has become a lucrative business, with reports showing income between $200,000 to as high as $11 million. According to SB Morgen, a Lagos-based geopolitical research consultancy, between January 2016 and March 2020, kidnappers were paid up to $11 million in ransom.

Parents of recently kidnapped victims of the Greenfield University in Kaduna also reportedly paid about N180 million for the release of their children held by bandits.

In the west, ritual killings and daylight armed robbery have made road commuters scared of leaving their homes. Commuters have allegedly been robbed by hoodlums while in traffic on connecting bridges in Lagos.

“Our staff bus was attacked by robbers on Eko bridge and they took our bags and phones. There was no policeman in sight,” said Justina Agaba who recently witnessed an armed robbery attack on Eko Bridge in Lagos State.

“I think they target nice cars and staff buses because of obvious reasons. Even the people working cannot make ends meet, what do you expect from these people living under the bridge with no income?” another motorist said at the scene of a robbery attack on June 11.

Insecurity is a huge impediment for growth, costing the economy $10.3 billion in 2020 — more than the federal government’s total revenue that same year, according to official estimates. 

“While you have many people going into the informal sector and hustling, criminal activity has become one of the options to get by,” the World Bank’s country director for Nigeria, Shubham Chaudhuri, said in an interview. “In the context of rising inflation, that means a further deterioration of the purchasing power and livelihood of many Nigerians.”

What Must Be Done?

The World Bank has advised that Nigeria takes drastic steps to end its chaos and work on developing a sustainable economic recovery plan.

The Washington-based lender also challenged Central Bank’s position on inflation that stems primarily from supply constraints, citing tight exchange-rate controls and expansive monetary policy as key drivers of price growth.

The lack of a credible monetary anchor is also responsible for keeping inflation rates elevated.

The World Bank urged Nigeria’s apex bank to aim for greater flexibility by reestablishing a dollar interbank market, effectively allowing banks to trade currency on their behalf to increase liquidity and move toward a single rate.

Hopefully, when these measures are worked on and attained, the World Bank can release the $1.5 billion loan it promised, diving the country deeper into debt.