Xmas: Going… Going… Going… Weak naira, dwindling oil price robbing Nigerians of merry Christmas

With five days to Christmas, the joy that is associated with the season may evade many Nigerian homes.

The sea­son is usually marked with pomp, but the economic reality on ground suggests oth­erwise. The reason is not far-fetched; the Nigerian economy has been plagued with uncertainty. The national currency is con­stantly losing its grip against the US dollar coupled with the dwindling crude oil price in the international market.

Not quite long, Minister of Finance and Coordinating Minister of the Economy, Dr. Ngozi Okonjo-Iweala, told Nigerians to brace up for tough times as the Federal Government would introduce some measures to reduce the impact of the fall of oil price.

In this vein, one doesn’t need a soothsayer to know that tough times are here.

As at last Thursday, the naira at official rate, exchanged for 182 to one dollar, while the oil went all time low to $59 per barrel.

These are the two indicators that determine the strength of the economy of the nation, which invariably transmits to her citizens.

Survey carried out by Saturday Sun, indi­cates that most Nigerians are going through a tough economic time; struggling under a heavy burden arising from dwindling income, caused by the two factors highlighted above – weak naira and oil price at a very low ebb.

Prices of goods and services are hitting the rooftop and traders groan under low patron­age.

For the children, it is not their concern if their parents are passing through economic stress, as Christmas means wearing of new clothes and shoes and having good and swell times.

Prince Dave told Saturday Sun that it may not be case with his children this Christmas because the money is not there for such luxu­ries. “They have been wearing new shoes and clothes every year, so, if this Christmas is an exception, therefore, there is nothing wrong with it. This is an opportunity to make the children understand the vicissitude of life,” he said.

Elochukwu, a trader at Computer village, Ikeja, lamenting, said he felt disappointed over the recent turn of events in the country, noting: “Christmas is meant for those who want to celebrate it. This year’s Christmas has not favoured me at all. I thought it would be like last year’s, no one is even patronising me. For the past four days, I have not sold more than three goods in a day,” he lamented.

Mrs. Bukola, a civil servant, also expressed her dismay over the increase overnight in prices of commodities, saying: “How much is my salary? I just wanted to buy three tubers of yam that sold for N1,500 before; I was told it is now N2,500. I bought it at N2, 200, because I bargained with the seller, who told me that naira has fallen. I wonder what this country is turning into.

Like Elochukwu and Bukola, Tony also shared the same pessimism and said this year’s yuletide will be on a low key. “I must confess, the state of the economy has changed every­thing, salary has been irregular, house rents have shot up; also transport fares from Lagos to the East. Am yet to buy things for my fam­ily, and I know the prices have skyrocketed,” he explained

Ahmed Zakari, a trader who sells perish­able food items like, tomatoes, pepper and on­ions, sees the increase in prices of goods from the lingering security crises in some parts of the North and not even the fall in oil price or the naira.

Following this unpalatable trend, some Ni­gerians blamed the government for incorrect decision making, reckless spending and greed on the part of politicians.

Kingsley Chukwu, a political analyst, said he does not believe that the ordinary Nige­rian has to share the blame of the dwindling economy.

“You cannot blame the ordinary Nigerian for the pitfalls of the economy. The people they voted into power are to be blamed for the way they steer the wheel of the economy. As you can see, reckless spending, corruption and 2015 elections have polluted the minds of our politicians,” he lamented.

He further stressed that if the economy is diversified, celebration of Christmas would not be hampered without any financial surge.

Rice is the staple food in most households, especially on Christmas day. A visit to Alaba Rago Market in Ojo, shows that the prices of rice have increased slightly above N10,000 de­pending on the brand. One of the traders, who identified himself as Marvelous, explained: “People demand rice more at this period, ei­ther as gifts to other people or for parties just as the demand for ram and chicken also rises at the Muslim festival and Easter. The demand is expected to increase.”

When Saturday Sun visited Mile 12 Mar­ket, tomato sellers complained of low patron­age. One of the sellers, Mr. Austin Okata, la­mented that the patronage has been very low since the commencement of this year’s festive period and attributed it to the downturn in the economy. According to him, as at last year, a basket of tomatoes cost N5,500, and now the price has come down to N4,500, yet, buyers complain that the price is too much.

Mrs. Funke Azeez, another tomato seller, echoed Okata’s position. According to her, business has been very dull, even though a basket goes for N4,500, there is still low pa­tronage and we sell most of our goods on credit.

As a personal reward for their efforts during the year, some people buy new or replace their old cars. This year, car dealers’ lamentations are hitting high heavens as they complain of low patronage. One of the dealers at Berger Auto Mart, poignantly told our correspondent of how the dwindling economy is affecting their business adversely.

According to him, people would come and by the time you tell them the price of a par­ticular car, they shudder and leave. He noted the dwindling fortune of the naira as the major cause.

Yomi Ladua, another car dealer, said the great fall of the naira is affecting the economy, and has increased the prices of cars. Fairly used cars, which sold for N1.1 million now go for N1.3million because of the high exchange rate.

Emmanuel, who handles vehicle registra­tion, told our reporter that he was surprised by the turn of events. “By this time, clients would be calling and giving me dates to com­plete their new vehicles documentations, but now, we are just still hoping, just few days to Christmas.

In fashion and clothing, Saturday Sun ob­served that there is a slight increase in the price of clothes as sellers complained bitterly of low patronage; while buyers are lamenting that there is little or no cash in circulation.

At the popular Tuesday Aswani Market in Isolo, Lagos State, wholesale dealers com­plained bitterly about sharp decrease in de­mand. Activities in the market picked up, as buyers were seen scrambling for clothes, es­pecially the cheaper and lower quality ones.

Mrs. Folake, who deals in lace and ankara materials, said, there is a little increase in the price of lace material, which she said, was as a result of the increase in dollar exchange rate. “The increase is not much and besides most of us still have in stock materials that were imported three months ago. Nigerians who are still interested should please come around and buy at the same price. It’s only the ankara materials that are still in high demand because of ceremonies. Generally, the season sales are very poor.”

A retailer, who identified himself as Emma, said the slight increase is very noticeable. “In November, these shoes were sold for N1,500, but now you can buy it for N1600. Our prob­lem is that the demand for goods has de­creased. Families that used to buy two pairs each for their children now go for one and they will tell you that they managed to buy them. You must buy things for the children or they will see you as a failure.

“I guess it is the economy, we are at a loss because at the end of the day, one will be forced to sell the products below the cost price. We only hope that buyers will do the normal last minute rush and we are willing to sell at give-away prices because we also need money to take care of our needs this Christmas.”

Unlike others buyers, Mama Seun is not bothered by the price increase or the economy. According to her: “Ever since the finance minister told Nigerians to cut cost as things would be hard, I adjusted. I thank God that my children heard it on TV, so it was easy to convince them to make do with one dress each for Xmas.”

Another customer, who was seen buying ankara material said that the price couldn’t de­ter people from celebrating. “No matter how bad things are, we must celebrate. The only difference is that the demand has reduced. Normally, DaViva materials go for N2,000, but today I bought them N2,500. Instead of an individual buying six yards, most person will pair, and divide it.”

Saturday Sun also visited the popular Ba­logun Market, which was a beehive of activi­ties. Retailers of ready-made materials have since taken over the major roads in the Island. Some of the buyers while scrambling for clothes, told our correspondent that you could buy them cheaper prices. “ It’s more like our own sales day. We get a lot of discounts on the roadside. I bought this jeans trouser for N700 as against N1500, it sells in shops. This is a time of buying cheap materials,” a male buyer said, displaying the jean.

Another buyer admitted that the wears could be of inferior quality but are affordable. “I know that it is of inferior quality, but it is better than none. You can buy so many designs and keep changing dresses during the season as against buying one cloth in the name of de­signers.”

From the materials to the jewellery, the story is the same. “There isn’t much money in circulation, this is why some of these cheap jewellery are in display. There are more buy­ers but the question is, what type of jewellery are they buying? I do not blame them, it’s the economy. This is why we imported more of affordable jewellery,” one of the sellers said.

The cost of transport may hit the roof fol­lowing the ongoing strike by NUPENG and PENGASSAN.

In aviation, for, instance, where air trans­port is stabilising, experts have pointed out that a general rise in the prices of goods and services is expected to follow the recent fall of the naira. Experts have also predicted that fares may likely rise during festivities if the naira continues to lose value to the dollar.

This is because majority of the airlines op­erational costs are priced in dollars, yet for domestic airlines, they charge airfare in naira. This suggests that beyond the rise in cost of doing aviation business, local airlines will be forced to adjust fares to make up for the loss in naira value to the dollar.

For instance, Chairman of Discovery Air, Engr. Babatunde Babalola said that the cost of maintaining an aircraft is very high and that most of the maintenance done overseas at­tract huge sums of dollars. “Normally, when you go for a C-Check you spend an average of about $300,000 in other places like Turkey, Poland and some other countries, you can get it cheaper, but on this particular one, we spent nothing less than $800,000”, Babalola said. What this means is that the cost of mainte­nance charged in dollars will definitely affect the cost of doing business; and for airlines to recoup return on investments, the air traveller may be made to pay more.

The Managing Director/CEO of Med-view Airlines, Alhaji Munir Bankole, was quoted as saying that the aviation industry will feel the heat, as the cost of maintaining aircraft would go up significantly. According to him, if the naira continues to slide, profits will be eroded, adding: “We charge fares in naira yet we run almost all our operations in dollars.”

Apart from maintenance, cost of aviation fuel may compound the matter.

Unlike air travel, the road transport mode will be worse hit because a large portion of the population travels by road.

The sudden and unexpected return of ve­hicular queues at petrol stations in Lagos and Abuja over the past week is going to be an­other nightmare during this season.

A visit to major motor parks in Lagos such as Ojuelegba, Mazamaza, Iddo, Jibowu, Os­hodi, Ojota and Volks revealed that as usual transporters are warming up for the season. How? Those vehicles abandoned for months have been repaired and ready to go but wheth­er they are really road worthy is another mat­ter. Because of the upsurge, some unscrupu­lous ones deploy rickety buses on the road during this period. That’s why these travel­lers are often stranded whenever their vehicle breaks down during the trip. Although some operators recently got new vehicles from the Sure-P project to re-fleet or strengthen their operations, like the Young Shall Grow Motors and Izu Chukwu Transport, high demand and cost of fuel will shoot up fares this season.

At Mazamaza, a one-way trip by bus to the East was N3, 550 while Abuja was N4, 550 as at December 18. By 19th, N500 had been added to the fare and would double by Decem­ber 23 and peak on Christmas eve.

The Sun report