On May 29, 2023, Bola Ahmed Tinubu stepped in as President of Nigeria after Muhammadu Buhari’s eight years, in this report, WISDOM DEJI-FOLUTILE, takes a look at the administration of President Tinubu in the one month he has spent in office.
A month ago, the baton of presidential leadership in Nigeria was passed from Muhammadu Buhari to President Bola Ahmed Tinubu also of the All Progressives Congress (APC). After what a majority of Nigerians would describe as a tumultuous eight-year tenure, Buhari transited into the annals of a former leader.
Along with that passing on of the torch has come some heat. Tinubu, who made it no secret his ambition to one day rule the Republic that serves as home to the largest black race in the world, has looked like a man on a mission.
Right from his inaugural speech on May 29, 2003, the 16th President of the Federation had begun dropping decisive yet definitive declarations to set the tone of his Presidency.
For instance, in an unscripted remark on the day of his inauguration, Tinubu had declared that fuel subsidy no longer had a provision in the country’s bloated and yet inefficient national budget structure, calling it a scam. And shortly after his declaration, it was so.
On June 9, barely a fortnight after his inauguration, the President assented to the Electricity Act 2023. The Act, which replaces the Electricity and Power Sector Reform Act from 2005, is expected to prioritise the de-monopolisation of the country’s power sector, empowering states companies and individuals to generate, transmit and distribute electricity
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After suspending Godwin Emefiele from his post as Governor of the Central Bank of Nigeria and launching an investigation into the office of the governor, Tinubu went to work on reshaping the structure of his economic mandate.
Just two weeks after his inauguration, the President signed the Student Loan Bill, proposed in 2019, into law. The bill, which will enable Nigerian students to access loans at interest-free rates, served as a precursor to further impending reforms to the education system in Nigeria
A few days after, it was widely reported on June 14 that the new-look CBN would float the Naira, removing direct intervention from the apex bank and eliminating a fixed price for forex trading within the country.
On June 19, Tinubu had reshuffled and replaced all the country’s service chiefs. This was exactly three weeks after this inauguration.
Economic reforms
Even as the front-footed approach of Nigeria’s latest Aso Rock resident has not been lost on Nigerians, the effects of Tinubu’s policymaking have had significant effects on the average Nigerian’s position in the country’s economic landscape.
The first effect of Tinubu’s leadership was the removal of subsidies—a move that experts, political stakeholders and everyday Nigerians had anticipated as a possibility from any elected administration due to the increasing impracticality of the expense.
However, the subsidy removal was not cushioned. Overnight, following Tinubu’s declaration of subsidy removal, motorists who had purchased PMS at N186 per litre just the night before were suddenly shelling out N500-N550 per litre as panic buying ensued.
By May 31, the National Petroleum Company (NNPC) Limited had unveiled an official pump price well over N500 per litre in Abuja .
The domino effect of a sharp increase in the price of petrol—a commodity that powers the economic lifeblood of the country—was observable in a spike in the cost of goods and services in the country. It was well documented that transport costs soared well over 150% higher than the regular fare in many areas of the country.
The cost of consumer products, farm produce and commodities like provisions and toiletries were also affected.
Because of this, Nigerians began to clamour for previously underplayed demands, like shorter work weeks to reduce commute time and a higher minimum wage.
The Edo and Kwara State Governments had shortly after the spike in fuel prices nationwide announced a three-day work week for government workers, with the announcing a N10,000 wage increase to salaries of government workers.
The NLC had in June demanded a N150,000 – N200,000 minimum wage, which spells an almost unimaginable boost from the N30,000 monthly wage currently approved as the national wage minimum.
Although the NLC’s demands were deemed “unrealistic” [https://guardian.ng/news/nlcs-demand-for-n200000-minimum-wage-not-realistic-fasua/], the reasoning behind the request was indisputable, considering the impracticality of the existing minimum wage in light of current costs of living.
Arguably, Nigerians are experiencing a harsher climate than was the case before the new president took over.
Although the President directed the National Economic Council (NEC) led by Vice President Kashim Shettima to devise palliative measures to mitigate the impact of subsidy removal on the citizens, there has been no feedback on that line since the announcement was made.
However, the fuel subsidy caused cost-push inflation was not the only factor driving economic ramifications in such proportions. Following the standardisation and free float of the Naira, the Investors & Exporters (I&E) window quoted Naira to Dollar rates ranging from ₦750 to ₦755/$. This was a significant spike from the official rate of N460, which had until the float helped keep the cost of forex-aided production costs and importation down.
The effect of the resulting Naira value has significantly impacted every stratum of the Nigerian populace. Although higher-priced imported goods are forcing Nigerians to consider local alternatives, such alternatives are not so much affordable as a result of the increased production costs caused by fuel price increases and spiking transportation costs.
At the tail-end of June, just one month after the inauguration, it was reported that the price of tickets had soared to unprecedented heights due to the high exchange rate for ticket pricing. BusinessDay had reported that Nigerians began suspending travel plans to North America and Europe due to the astronomical increases in the cost of travel tickets almost overnight. For instance, a ticket which would’ve cost an average of N1,200,000 – N1,500,000 in May 2023 would’ve cost about N1,900,000 – N2,500,000 just one month later.
The festivities of millions of Nigerians were also affected by price increases when ram sellers lamented low patronage of the livestock despite the Eid al-Adha celebrations in late June.
Ram sellers had priced their livestock at N250,000-N300,000, in which case represented a 100% hike from the price of the same commodity in 2022 .
But have there been any positives?
Although the general spirits of Nigerians are not dampened, so far, positive projections are yet to be assessed.
According to the Bank of America, the free float of the Naira has led to the currency being undervalued.
BoA said it sees the value of the naira settling at N680 to the dollar by the end of the year, saying that the currency has moved from being overvalued to being undervalued following the government’s recent foreign exchange reform .
In smaller-picture instances, there has been marginal progress misinterpreted to be a direct result of the reforms of the new administration. For instance, the decrease in the cost of cooking gas, which is assumed to be one overstated positive, is actually owing to lower crude oil prices and a decline in global gas prices (as demand is less). The trend had been noted and extensively documented over a month before the installation of the new dispensation. And according to the U.S. Energy Information Administration, the current price of natural gas dropped by 76.1 per cent to $2.10 per one million BTU on May 31, 2023, from $8.78 per one million BTU. May’s price, which has consecutively declined since December 2022, is also the lowest since September 2020.
As of mid-June, Nigeria’s inflation rate had continued to climb, reaching 22:41 per cent according to the National Bureau of Statistics (NBS).
However, perhaps it is too early to call it. Nigeria’s new leadership is yet to announce its cabinet and has not crossed the much dramatised 100-day mark. Nigerians might be expected to exercise more patience, but cannot help but ask if this is merely a replay of a consistency in government failure or if they are on the precipice of something greater.
Meanwhile, the citizens are waiting and hoping it won’t be a wait for Godot!
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