Building resilience in tough times

By Elvis Eromosele

Two sisters, ages 5 and 3, were playing behind my residence. The younger one who was drinking pure water started pouring some away, like children are prone to do. And I heard the older sister rebuke her, “Stop it; don’t you know Nigeria is hard?” It was startling and unsettling to realise that children are no longer immune from inflationary pressure.

It is no longer news that Nigerians are facing tough economic times. Recent government decisions like removing fuel subsidies, devaluing the naira, and now eliminating electricity power subsidies have caused a lot of stress for businesses and citizens. These changes, meant to help the economy in the long run, are right now difficult for everyone. Let’s break down what’s happening and explore ways for Nigerians to cope.

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Fuel subsidy removal:

The government removed fuel subsidies in its desire to free up money to attend to other important areas in the economy. A fallout of the policy is that businesses that rely on affordable fuel, especially small and medium-sized ones, got squeezed. Costs went up, profits went down, and some people even lost their jobs. Household expenses went up in smoke. This made the whole economy unstable.

Naira devaluation:

As with devaluation anywhere in the world, the goal was to make Nigerian exports cheaper and possibly attract more foreign investment. It, however, backfired spectacularly. What happened was that the value of the naira went down, and everything became more expensive. People couldn’t buy as many goods with their money, and businesses that import things had to pay more for them. Inflation seemed to be on steroids.

Power subsidy removal:

Now, the government has announced that electricity bills are going up. Families and businesses alike are likely to be hurt. Experts argue that this makes it harder for people to afford basic needs and for businesses to be productive. It would equally contribute to widening the gap between the rich and the poor.

The good part is that the same government that triggered the problems can take steps to fix them.

The place to start is the place it has wanted to start for half a century. This is the diversification of the economy. It is time to spread the wealth. The economy cannot continue to rely so heavily on oil. The government must, as a matter of urgency, begin investing in things like agriculture, manufacturing, and technology. Through these, it can create a more stable and long-lasting economic foundation.

Read also: Mitigating economic hardship: The Nigerian narrative

The second thing has been spoken about equally for almost forever. The government must now move beyond talk. It needs to demonstrate that it is careful with the country’s wealth. This means allocating resources effectively, truly cutting waste, and being transparent about spending. The government must not only appear to be cutting the cost of governance; it must also be seen to be doing it sensibly.

It is equally critical for the government to boost investment in infrastructure, especially power generation and distribution. It needs to look at all existing projects and actively encourage their completion. The deal with German electricity giant Siemens, which is expected to lead to the production of 25,000 megawatts of electricity by 2025, must be pursued relentlessly. It promises to be a huge game-changer for the nation. It will improve electricity access, attract investment, and boost economic activity.

While the above is ongoing, the government needs to urgently create safety nets to support people who are struggling today because of these changes. This could include targeted subsidies, cash transfer programmes, and free job training initiatives. And it must communicate more. It is not enough to leave people to make assumptions. The government has to consistently talk to the people, share its goals, and, where necessary, voice its challenges.

The good news is that Nigerians are known for their resourcefulness. People are already exploring ways to deal with these economic challenges. Here are some quick suggestions from experts:

Create a plan:

Make a budget, track your spending, and try as much as possible to save some money for a rainy day.

Improve your skills:

Boost your capacity, learn new skills, or even consider starting your own business. No one can afford to be idle at this time.

Explore multiple sources of income:

We have to admit at this point that motivational speakers were right after all. Multiple sources of income really can shield one from the effects of economic fluctuations.

Use your voice:

You may need to join advocacy efforts. For instance, talk to your representatives about the challenges the community is facing.

By working together, Nigerians can build a brighter, more resilient, and inclusive economic future for all.

Eromosele, a corporate communication professional and public affairs analyst, wrote via: [email protected]