Africa's largest economy saw the inflation rate reach 15.75% in December, its highest in 33 months, according to figures from the national statistics office, the National Bureau of Statistics (NBS). Nigeria, which had closed its borders from August 2019 to December 2020 (the import of rice and certain foodstuffs remained prohibited) to stimulate its food self-sufficiency process, is moving even further away from the convergence criteria for the adoption of the Eco, the ECOWAS single currency.
This Olympic inflation, which is partly the result of the instability of the national currency, the Naira, supported by massive drawdowns in foreign exchange reserves, is being felt heavily in the housewife's basket. For example, the NBS estimates that food inflation reached 19.56% in December 2020 compared to 18.30% a month earlier. “This rise in the food index was caused by the increase in the prices of bread and cereals, potatoes, yams and other tubers, meat, fruits, vegetables, fish, and oils and fats,” reports the

Similarly, core inflation, which excludes changes in food and energy prices, stood at 11.37% in December 2020, up 0.32% from 11.05% in November. The NBS estimated that the largest increases during the month were recorded in the prices of passenger air transport, medical services, hospital services, footwear, passenger transport by road, miscellaneous services related to hair salons and personal care establishments

The largest economic country in Africa, Nigeria is said to have 87 million poor people. A paradox?

According to observers, this inflation is caused by various factors, including the Covid-19 pandemic, which has destroyed the country's macroeconomic parameters, the depreciation of the national currency and the closure of borders with neighboring countries. The Lagos Chamber of Commerce and Industry (LCCI) and the Nigerian Industrialists Association (MAN) noted in 2020 that the border closure had driven up input and finished product prices in Nigeria. “For the year 2021, we expect global inflation to remain high as the combination of food supply shocks, foreign exchange (FX) policies, higher energy costs, currency illiquidity, increased insecurity in the main food-producing states, will continue to increase the pressure on consumer prices in the domestic market. ”, noted Muda Yusuf, director general of the LCCI, as quoted

Nigeria has the largest number of poor people in the world, with 87 million living in extreme poverty, according to a 2018 World Poverty Clock report. The unemployment rate is 27 percent according to the NBS. Economic operators believe that one of the measures to reduce inflation would be to increase trade with neighboring countries. If President Muhammadu Buhari persists in this option of restricting trade with neighboring countries, the first half of the year should still see inflation reach new records. “With fuel price increases (between 25 and 30 percent), electricity price increases (between 55 and 65 percent), currency weakness and food price pressure, global inflation will reach 16 to 18 percent in the first half of 2021,” said Wale Okurinboye, head of investment research at Sigma Pensions, quoted by nairametrics.com.
The country's 2021 budget forecasts that inflation will reach 11.95% in 2021 with a projected GDP growth of

3%.