Nigerians & Nigerians are presently battling a rather humongous or skyrocketing inflation rate and unemployment rate. Accrediting to the Nigerian bureau of statistics, the inflation rate currently stands at 18% while unemployment rate is at 33%. But these numbers don’t tell the true reality compared to what’s obtainable in the markets, labor & commodities. The effect on this on the overall economy cannot be overemphasized, coupled with the unpredictable Naira to dollar exchanges rates which currently sits at NGN500 to 1 dollar.
While there are rational economic reasons for the increments in prices across boards certain factors also contribute to this increments. The road transportation sub-sector of the Nigerian economy is an important sector as large number of goods are moved from farm/production for the market centers. This sub-sector; is a huge cost center for Nigerians and it’s not necessarily because the roads are bad but because of security and insecurity.
Insecurity in Nigeria is presently at an all time alarming rate, from kidnapping to banditry to farmers/herdsmen crisis. However, that not the thrust of this article.
On the other hand, security which should imply providing a safe and secure roads for goods & services delivery. For example recently the issue of the high prices of Dangote cement prices compared to other countries with same dangote brand cements came to fore. It’s was widely reported that while prices were much lower in countries within the sub-Saharan region by the same company the prices are much higher in Nigeria.
According to Dangote’s Group Executive Director, Strategy, Portfolio Development & Capital Projects, Devakumar Edwin revealed that, while a bag of Cement sells for an equivalent of $5.1, including VAT in Nigeria, it sells for $7.2 in Ghana and $5.95 in Zambia ex-factory, inclusive of all taxes. He said that though the company has direct control over its ex-factory prices, it cannot control the ultimate price of cement when it gets to the market. He advised that it is important to distinguish Dangote’s ex-factory prices from prices at which retailers sell cement in the market.
Thus the price increment is largely owing to logistical cost within Nigeria. This applies across board to other products and commodities within the country. Numerous security agents mounts road blocks and check points or rather extortion points on the highways across the country. These agents illegally extorts motorists and transporters as if it’s legal and government as usual decides to turn a blind eye to this illegality which is fast crippling the economy. Eroding disposable incomes of both the middle class and lower class citizens.
Even intra city transportation is not left out as it’s a usual practice now to transports goods with a security agent attached to the vehicle. This is done to hopefully reduce the amount you be paid as bribes by the ever present extortionists.
It’s time the government takes a decision on this, perhaps government should stop paying salaries and allowances to the security agents so we can now know that we actually directly pay them through bribes.
The earlier the better!