Economy

By Anas Abbas

Nigerians are grappling with the harsh realities of rising food prices and crippling inflation, largely attributed to the removal of fuel subsidy by President Bola Ahmed Tinubu.

This policy shift, which many see as the primary driver of the current economic hardships, has compounded the challenges Nigerians faced during the previous administration.

Now, more than ever, the cost of living has become unbearable for many.

The Daily Reality has gathered that the business community is also struggling to stay afloat.

Entrepreneurs are battling to maintain profit margins as operational costs continue to soar.

This has sparked widespread calls for government intervention, as many consumers believe the rise in food prices is excessive and, in some cases, artificially inflated by market forces.

Painful outcries

The surge in food prices has left many ordinary Nigerians, not only in Kano, in dire straits.

In a series of interviews conducted by The Daily Reality in Kano, citizens revealed how the price hikes have made basic necessities unaffordable, forcing some families to cut back on meals.

“I can no longer provide three meals a day for my family. Sometimes, we go to bed hungry,” said Mrs. Aisha Yahaya, a mother of five.

“Before, a bag of rice was N50,000, now it’s N90,000. How can I afford that on my meager pension?,” lamented a retired civil servant.

A visit to Singer Market painted a bleak picture. Once bustling with activity, the market now has a somber atmosphere, with many stalls closed and traders struggling to make sales.

Customers, too, appeared despondent, unable to afford the inflated prices.”The price hike has ruined our lives. We can’t sell, we can’t buy. We’re just surviving,” said one trader, who preferred to remain anonymous.

Price hike beyond our control

Alhaji Samaila, Managing Director of Hamir Investment, explained that the rising prices are not the fault of traders, but a result of the market’s dynamics.

“When goods become scarce in the market, those who have stock take advantage and raise prices beyond reasonable levels,” he said.

Samaila also pointed out that companies often increase prices without notifying their customers, exacerbating the situation.

“This has led to commodities increasing by as much as 20% to 50%,” he added.

Unregulated market leads to price exploitation

The Daily Reality found that the lack of government intervention and regulation has allowed traders in Singer Market to set prices arbitrarily.

This “open market” situation has created a breeding ground for price exploitation, where traders take advantage of scarcity to inflate prices.

The absence of a regulatory framework has left consumers vulnerable, with market prices often dictated by who can pay the most, rather than by genuine market forces like supply and demand.

Traders forced out by price instability

The instability in prices has not only affected consumers but also forced some traders out of business.

With the rising cost of goods and dwindling capital, many traders are finding it increasingly difficult to continue operations.

Alhaji Samaila lamented the impact of the economic downturn on sales and investments.

He shared that a regular customer who previously purchased goods worth N2.5 million now struggles to make ends meet.

“The uncertainty in pricing has led to suspicions of price gouging, and the overall trust in the market system is eroding,” he said.

A call for intervention

Barr. Junaidu Muhammad Zakari, Managing Director of Singer Market, has called for urgent government intervention to curb the escalating prices.

He attributed the hike primarily to the removal of fuel subsidies, but also highlighted other contributing factors such as poor agricultural output and over-reliance on foreign goods.

Zakari urged the government to take proactive measures, including improving the agricultural sector, promoting local competition, and licensing more companies to produce goods domestically.

This, he said, would reduce the pressure on imports and stabilize prices.

A way forward

Zakari noted that the removal of fuel subsidies has had a devastating impact not just on Singer Market but across Nigeria.

To address this, he called for the establishment of a price regulatory body that can monitor and control prices, ensuring they remain fair and reasonable for both businesses and consumers.

“The current situation is unsustainable. Without proper regulation, the price hike will continue to cripple businesses and impoverish consumers. The government must act now to create a fair and equitable market environment,” Zakari warned.

Anti-corruption commission steps in

Muhi Rimin Gado, Managing Director of the Public Complaint and Anti-Corruption Commission, also weighed in on the issue, expressing the need for immediate action to address the artificial inflation plaguing the market.

“We cannot fold our arms and watch this situation spiral out of control. Steps must be taken to curb the excessive price hikes and provide relief to the people,” Gado declared.

His remarks have sparked hope among the public that the government will take decisive action to mitigate the artificial inflation that has caused so much hardship.

By Salisu Uba, PhD, FCIPS

Nigeria has embarked on a significant fiscal reform with the introduction of the Deduction of Tax at Source (Withholding) Regulations 2024, effective from 1 July 2024. Signed into law by the Minister of Finance, these regulations dismantle a nearly five-decade-old withholding tax (WHT) regime, signalling a pivotal shift in the nation’s economic structure. For supply chain and business stakeholders, understanding and capitalising on these changes is crucial for fostering sustainable, value-added growth in an evolving market.

Streamlining Taxation to Boost Supply Chain Efficiency

The new WHT regulations offer significant rate reductions that directly benefit the supply chain ecosystem. Notably, the WHT rate for payments to Nigerian companies for professional, management, technical, and consultancy services has been halved from 10% to 5%. This reduction eases financial pressures and improves liquidity, enabling businesses to reinvest savings into key areas such as logistics, technology, and workforce development. With enhanced cash flow, supply chains become more agile, swiftly responding to market demands while reducing operational bottlenecks.

Additionally, the WHT rate for payments related to other services and the supply of goods or materials to Nigerian residents has decreased from 5% to 2%. In the supply chain sector, where margins are often tight, this reduction helps lower overheads. It allows companies to reallocate resources to optimise inventory management, strengthen supplier relationships, and invest in advanced supply chain capabilities. These savings can translate into more competitive consumer pricing, strengthening market positioning and driving business growth.

Fostering Sustainable Infrastructure Development

Infrastructure is vital to the smooth functioning of supply chains, and the new regulations demonstrate the government’s commitment to supporting this critical area. The WHT rate on payments to Nigerian residents for constructing roads, bridges, buildings, and power plants has been slightly reduced from 2.5% to 2%. While modest, this adjustment reflects a broader strategy to enhance Nigeria’s infrastructure. Improved infrastructure facilitates more reliable and efficient logistics, reducing transit times and minimising disruptions, which bolsters supply chains’ overall resilience.

Empowering Small and Medium Enterprises (SMEs)

Small and medium enterprises (SMEs) are the backbone of Nigeria’s supply chain, serving as key suppliers and service providers. The new regulations offer exemptions for companies and unincorporated bodies with a turnover of 25 million Naira or less on transactions up to 2 million Naira, provided the supplier has a Tax Identification Number (TIN). This exemption reduces the administrative burden on SMEs, encouraging formalisation and integration into the broader supply chain framework and tax system. These reforms promote diversity and resilience by supporting SMEs, ensuring smaller players thrive alongside more giant corporations and contributing to a more robust, dynamic supply chain ecosystem.

Enhancing Compliance and Transparency

The extension of WHT liability to payment agents and the requirement to issue receipts for withholding tax deductions are vital steps towards greater transparency and accountability within the supply chain. These measures ensure tax obligations are met promptly and accurately, reducing the risk of disputes and fostering trust among business partners. For procurement professionals, enhanced compliance simplifies auditing and mitigates the risk of financial discrepancies, enabling more efficient and reliable supply chain management. Transparent tax practices also enhance Nigeria’s business ethics and foreign investment.

Strategic Adaptation: Navigating the Transition

Adapting to the new WHT regime requires careful planning and proactive engagement. Supply chain experts should thoroughly reassess existing contracts to ensure they align with the revised tax obligations. This may involve renegotiating terms with suppliers and partners to accommodate the new WHT rates and compliance requirements. Working closely with tax advisors and leveraging expert guidance can help businesses navigate the reforms’ legal, tax, and financial implications, minimising disruptions and capitalising on the benefits of the new regulations. Proactive adaptation will turn potential challenges into greater efficiency and competitive advantage opportunities.

Sustainable Value Creation in the Supply Chain

The overarching objective of Nigeria’s WHT reforms is to create a fairer and more efficient tax environment that supports sustainable business growth. For the supply chain sector, reduced tax burdens enhance operational efficiency, while support for SMEs and infrastructure development lays the foundation for long-term resilience and innovation. Businesses can invest in sustainable practices such as green logistics solutions and supply chain transparency initiatives by lowering costs and improving cash flow. These investments contribute to environmental sustainability, build competitive advantage, and create added value for stakeholders. I also encourage the government to look into its supply chain to increase transparency, promote equal opportunities, prioritise local procurement of all goods and services, and digitally transform the function across MDAs.

Conclusion

Nigeria’s Deduction of Tax at Source (Withholding) Regulations 2024 represents a transformative step in modernising the country’s tax framework. The implications for supply chains are profound, offering opportunities to enhance efficiency, support small businesses, and invest in sustainable growth. By strategically adapting to these changes, companies can transition smoothly, leveraging the new tax environment to build more resilient, value-driven supply chains. 

As Nigeria continues to refine its economic policies, the supply chain sector stands to benefit from a more equitable and supportive fiscal landscape, driving sustainable growth and long-term prosperity. The Federal Government and the Presidential Fiscal Policy and Tax Reforms Committee, led by Taiwo Oyedele, deserve commendation for their forward-thinking approach. These reforms alleviate immediate financial pressures on businesses and pave the way for a more dynamic, resilient, and value-added supply chain ecosystem in Nigeria.

Salisu Uba, PhD, FCIPS, is a Fellow of the Chartered Institute of Procurement and Supply Chain UK and Founder of NatQuest – a supply chain technology company based in the UK.

By Uzair Adam

An international financial organization, the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI), has appointed Sheikh Dr. Bashir Aliyu Umar, the Chief Imam of Al-Fur’qan Mosque in Kano, as a member of its reconstituted Shariah Board for the 2024-2028 term.

Dr. Bashir Aliyu Umar is one of 22 newly appointed members selected during a recent board meeting of AAOIFI, held at the organization’s headquarters in Bahrain.

This appointment further solidifies his contributions to Islamic finance, having previously served as Special Adviser on Islamic Banking to the Central Bank of Nigeria (CBN) under Muhammadu Sanusi II.

AAOIFI, established in 1991 and based in Bahrain, is a leading international organization that sets standards for the global Islamic finance industry.

The new appointments to its Shariah Board are intended to provide expert guidance for the continued development of Islamic financial standards worldwide.

Other appointees to the Shariah Board include prominent Islamic scholars from across the globe, such as Sh. Abdul Rahman Al-Atram, Sh. Abdullah bin Sulaiman Al-Manea, and Prof. Waryono Abdul Ghafur.

In addition to his current role, Dr. Bashir has previously served as a Commissioner at the Kano State Sharia Commission and as a member of the Kano State Pilgrims Welfare Board under the administration of Malam Ibrahim Shekarau.

By Jibril Mutalib

The naira notes live a life as colourful as the country itself. This isn’t just any currency—it wears its experiences on its sleeve, or rather, on its creases, tears, and patches. The naira isn’t just a medium of exchange; it’s a survivor with a story that shifts depending on where it finds itself in this country.

In the northern part of the country, the naira is a seasoned warrior. It has seen the depths of pockets unwashed for years and battled with rain and sun, leaving it bruised and wrinkled. Yet, the good people of the North, perhaps because of their warm hospitality, never turn their backs on the naira, no matter how worn out it appears in most cases. 

A naira note in Sokoto could look like it just took a swim in the gutter, got into a wrestling match with a goat, and lost a few limbs. But fear not! The traders in the North would still embrace it with open arms. Ah, my friend,” a northern trader might say, “kudi kudi ne”, whether it looks like a prince or a pauper. 

As long as it can buy me a cup of fura or a plate of Denkeli, it’s good enough!” If your money is rejected, then it must be very bad. Perhaps it might have undergone an abnormal surgery where you have Obafemi Awolowo appear on a #50 naira note. Lol.

But when travelling to other regions, the naira’s fortunes change quicker than you can imagine. In places like Kwara, the naira is subjected to intense scrutiny—borderline interrogation. The traders will examine it like a detective at a crime scene, looking for any sign of distress. A small tear? Rejected. A hint of dirt? Not in my shop! And don’t even think about presenting a naira note with a sellotape surgery—it might as well be a counterfeit. Lol.

So, the naira itself is living a double life in different regions of the country. In the North, it is a rugged hero, loved despite its flaws. In the South, it is an outcast, shunned for the slightest imperfection. I wonder why naira notes are treated so differently based on location. 

And so, if you ever find yourself possessing a naira note that has seen better days, do not despair. Simply tuck it away safely and wait until you return to the northern lands. There, you’ll find a warm welcome for your weary traveller. And remember, it’s not just about having money; it’s about having the right money in the right place.

In any region you find yourself, blend with how they treat the currency. When you’re in Sokoto, bring whatever naira you’ve got—no questions asked. I’m not saying they accept money in Sokoto; they do but on rare occasions. If your money is denied, it’s already very bad beyond repairs.

By Tajuddeen Ahmad Tijjani

On Tuesday, August 13, 2024, President Bola Ahmad Tinubu presided over a significant Council of State meeting. Former Presidents, Vice Presidents, a former Chief Justice of the Federation, and several key ministers were in attendance. The highlight of the meeting was the President’s stance that Nigeria’s democracy must not be undermined. “Any change of government must be through the ballot box, not through violence, insurrection, or any other unconstitutional means,” he asserted. This is a position I, along with all patriots, fully support.

However, while the President’s commitment to democracy is commendable, his economic policies must reflect the urgency and needs of the people. The excuse of “fixing the economy” cannot be used to justify slow progress. Nigerians expect the leadership to hit the ground running from day one. The Council of State must convey the truth to the President: the nation is in a precarious state, and decisive, people-centred action is required.

Today, wealth in Nigeria is increasingly concentrated in the hands of a select few. At the same time, the majority struggle without access to necessities like quality education, healthcare, housing, and employment. It’s not that Nigerians envy the success of the rich; instead, they want access to the essentials for a decent life.

Unfortunately, greedy leaders deliberately subject many ordinary citizens to hardship. Endemic corruption has become the norm, and the promise of equal opportunities seems like a distant dream despite the blessings of natural resources across the six geopolitical zones.

Poverty remains a pervasive issue. Nigeria is rich with potential—oil and gas in the South, commerce in the Southeast, and fertile land in the North. There is no excuse for hunger or deprivation. The government should prioritize modern farming systems, where a single machine can achieve in an hour what once took a thousand hands.

State governors must fully support federal initiatives, but these efforts must go beyond the token gestures like distributing rice, which too often ends up siphoned off by officials or recycled into the market. Nigerians are not beggars; we have the talent and drive to achieve greatness, but we need an enabling environment, affordable fertilizers, and access to reliable electricity.

The time for excuses is over. The government must adjust to the realities on the ground. Removing fuel subsidies and floating the naira has brought unbearable hardship to ordinary people. These policies need to be revisited. We elected this government to make Nigeria work for everyone, not just the privileged few. A stitch in time saves nine: adjust the policies before it’s too late.

Tajuddeen Ahmad Tijjani wrote from Galadima Mahmoud Street, Kasuwar Kaji Azare, Bauchi State.

By Uzair Adam

The Vice President, Senator Kashim Shettima, has announced that the federal government is implementing measures to ensure the return of residents displaced by insecurity and floods in Niger State.

Speaking during a visit to an Internally Displaced Persons (IDP) camp in Gwada, Shiroro Local Government Area, Shettima expressed the administration’s commitment to alleviating the suffering of affected individuals.

He stated that his visit was a directive from President Bola Ahmed Tinubu to assess the conditions of the displaced residents and assure them of government support.

The Vice President also launched the distribution of relief materials at the camp, highlighting that each state had received N3 billion to address the impacts of floods and security challenges.

Shettima emphasized that states like Niger, Borno, Sokoto, Bayelsa, and Jigawa, which have been significantly affected by these crises, would receive additional support from the federal government.

He called on citizens and organizations to assist the government in providing relief to those affected by disasters across the country.

The Vice President was joined by other key officials, including the Minister of Information and National Orientation, Mohammed Idris, and the Minister of State for Agriculture, Senator Aliyu Sabi.

Niger State Governor, Mohammed Umaru Bago, disclosed that 14 out of the 25 local government areas in the state had experienced flooding this year, resulting in loss of lives and property.

By Anwar Usman

Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, has debunked reports suggesting an increase in the Value-Added Tax rate from 7.5 percent to 10 percent.

In a statement signed by him on Monday, Edun clarified that the VAT rate remains unchanged at 7.5 percent, as stipulated in the nation’s tax laws.

Edun reiterated that “the current VAT rate is 7.5%, and this is what the government charges on a spectrum of goods and services to which the tax is applicable. Therefore, neither the Federal Government nor any of its agencies will act contrary to what the laws stipulate.”

He further explained the importance of maintaining a balanced tax system, emphasizing that Nigeria’s tax framework is built on three key pillars: tax policy, tax laws, and tax administration.

While addressing concerns over government actions perceived as anti-human, Edun reassured Nigerians that fiscal policies are designed to promote sustainable economic growth and alleviate poverty, not to hinder them.

The Minister also stated, “Our focus as a government is to use fiscal policy in a manner that promotes and enhances strong and sustainable economic growth, reduces poverty, and makes businesses flourish.”

By Uzair Adam

Hope has been reignited in the minds of women entrepreneurs as the Chidoka family, through the Nneka Chidoka Outreach Program, awarded N100,000 grants to ten female small business owners in honor of their late mother, Nneka Chidoka.

The Daily Reality reports that the grants were awarded on what would have been her 76th birthday, continuing her legacy of support for women and small businesses.

Osita Chidoka, former Minister of Aviation and Chancellor of the Athena Centre for Policy and Leadership, announced the initiative in a Facebook post on Friday, September 6.

He invited female entrepreneurs with small teams of 2 to 5 staff, operating home-based or small-shop businesses with a daily turnover of less than N100,000, to signify their interest.

“She would have been 76 years old today,” Osita wrote. “Are you a female entrepreneur? Do you have between 2 and 5 staff? Do you operate from your house or a small shop? Is your daily turnover less than 100k? Are you a Mekaria Mentorship Program Attaché? The first five women to respond and meet these criteria will receive a message from the Nneka Chidoka Outreach Program today.”

The response was overwhelming, with more than 50 women sharing their stories. Ten were selected based on the program’s criteria, receiving N100,000 each to support their businesses. One recipient, Nkechi Eze, a fashion designer, expressed her gratitude: “This support is a dream come true. It’s not just about the money; it’s about knowing someone believes in me and my business.”

The Nneka Chidoka Outreach Program, created in honor of Nneka Chidoka, who passed away in 2023 after a long battle with cancer, continues to promote her values of resilience, compassion, and community support. Led by her children, the foundation focuses on cancer awareness, screening, and treatment, as well as educational support for young people.

Since its inception, the program has screened over 2,000 women for cancer, provided free surgeries for more than 60 women, and supported over 1,000 individuals with various health interventions, including the distribution of corrective eyeglasses.

Additionally, during her memorial service, the program covered school fees for over 500 students in Obosi.

“Our mother’s life inspired us to be positive, considerate, and empathetic. The Outreach Program is a testament to her boundless strength and compassion,” said Osita Chidoka.

He also emphasized that the program is more than charity, reflecting his mother’s core values of community strength, education, and accessible healthcare.

In a similar act of generosity, the Chidoka family last year provided cash grants to over 100 petty traders in Obosi, Ozubulu, and Ohafia, fulfilling their mother’s wish to support female-owned businesses as a way to alleviate family poverty.

By Uzair Adam

Residents of the Federal Capital Territory (FCT) took to streets on Monday to protest against the persistent fuel crisis in Nigeria, calling for immediate government intervention.

The protesters demanded a reduction in petrol prices, which they claimed has caused significant hardship for many Nigerians.

They also called for the dismissal of the Group Managing Director of the Nigerian National Petroleum Company Limited (NNPCL), Mele Kyari, citing his tenure as ineffective in resolving the fuel scarcity.

The protest follows a statement from the NNPCL highlighting that its substantial debt to suppliers is jeopardizing the sustainability of fuel supplies.

Carrying banners with messages such as “We are tired of fuel scarcity and stories on why refineries are not working,” and “No direction under Kyari,” the protesters expressed their frustration over the lack of progress in addressing the crisis.

The demonstration ended at Unity Fountain, where Aminu Abbas, the Convener of the Coalition of Concerned Civil Society Organisations, voiced his concerns about the ongoing fuel scarcity in a nation rich in oil resources.

He urged President Ahmed Bola Tinubu and other leaders to act swiftly to alleviate the situation, stating, “The time to act is now. Show us that you stand with the people, not those who profit from our misery. Mr. Kyari must be shown the way out, and the NNPCL must be reformed to serve the interests of all Nigerians. We will not be silenced.”

By Uzair Adam

The Nigeria Immigration Service (NIS) has provided reasons for the recent increase in international passport fees, citing the need to enhance the quality of the passports, ensure faster processing, and improve accessibility.

During a sensitization event in Yola, Adamawa State, on Monday, NIS Comptroller Mr. Ibrahim Mohammed explained that starting from September 1, applicants within Nigeria will be required to pay ₦50,000 for a 32-page passport booklet with a five-year validity period.

This marks an increase from the previous fee of ₦35,000. The fee for a 64-page passport booklet, valid for ten years, will rise to ₦100,000, up from ₦70,000.Mr.

Mohammed clarified that the fee hike will not affect applicants living abroad. He emphasized that the new passports feature enhanced durability and quality, meeting international standards.

The inclusion of fingerprints in the new design makes it more secure and difficult to counterfeit compared to the previous version.He urged prospective applicants to apply online or visit NIS offices directly, cautioning against the use of intermediaries to avoid scams.

He also called on religious leaders to educate their followers on the changes and noted that those who apply before the September 1 deadline would still be charged the old rates.

The NIS is extending its awareness campaign to local government areas, beginning with Mubi, and has also taken the sensitization efforts to motor parks and major streets in the state capital.

Representatives from the Christian Association of Nigeria (CAN) and the Muslim Council in Adamawa, Mr. Joel Manzo and Alhaji Aliyu Iya, respectively, expressed their gratitude to the NIS for the enlightenment and pledged to relay the information to their communities.