Families and operators of businesses in the country have continued to decry the recent hike in petrol prices as they grapple with the escalating cost of living amid widespread discontent in the country.
The 50 percent increase in petrol price has rippled through the economy, driving up prices of essential goods and services, and exacerbating financial hardships for many.
The price hike, which came into effect early this month, has seen petrol prices soar to record highs of between N850/litre and N1, 400 per litre depending on the area, adding to the already mounting pressure on household budgets.
Owing to the hardship being experienced by the citizens, the Catholic Bishop of Sokoto Dioceses, Archbishop Matthew Kukah, recently, called on President Bola Tinubu and the leaders of the All Progressives Congress to take measures to ease the sufferings of Nigerians and also reverse the petrol price hike.
Arewa Youth Consultative Forum also condemned the recent increase in the pump price of petrol and warned the Federal Government not to take Nigerians for granted.
The Ooni of Ife, Oba Adeyeye Enitan Ogunwusi, appealed to Nigerians to be patient with Tinubu’s government, maintaining that things would soon get better.
“As the hardship persists, it makes life unbearable for many Nigerians, with many fearing that the air they breathe might not be free soon”
A frozen food trader and mother of two, Mrs. Arinola Olusoji, said, “I’m finding it difficult to balance my budget. The increase in petrol prices has added to my transportation costs, and I’m struggling to afford necessities like food and rent.
“We expected so much from this government, but what we are seeing now is the least we expected from Tinubu.
“You can imagine when we are having a queue from the northwest, Gbagada, to Anthony. I left my vehicle in Ikorodu to come here. You cannot imagine how much I paid to get to this place.”
The situation is even direr for low-income households, who are already struggling to survive on meager earnings.
“I don’t know how I’ll manage to feed my family,” said Johnson Odumakin, a Lagos commercial bus driver. The price hike has taken away what little savings I had, and I’m worried about our future.
“There is no fuel to work. There is even no black market. We bought the last fuel at the black market price of N7, 500 for five litres.
“Passengers have been complaining that the price of transport is too high, but what choice do we have when we are buying fuel for N1, 300 per litre?
“From Shonoyi to this place is N400. From Yetunde Brown to Bariga is N500, which is not supposed to be so.
“People are complaining that it is too bad. I’ve never seen this kind of scarcity before since my existence.”
In his remarks, a petty trader, Abdullah Isah, said, “I used to buy fuel N7, 000 per day. Now, I don’t even have N7, 000, and it finishes on time. One litre of fuel is N868. I don’t know what to do. I used to enter from my house to this place N500 before, now it’s N1, 200.
“You can imagine. It’s very terrible. Before you even see the bus, it’s very scarce. I have six children, how do I cater for them when I am spending that high on transportation and fuel? How much do you make from this business?”
Also speaking, Managing Director/Chief Executive Officer of Treasury Capital and Trust Limited, Tom Achoda, pointed out that the implications of the latest hike in the pump price of petrol and high inflationary pressure for businesses would be very significant and negative.
Achoda, who is also an economist, said that their impacts may further erode the value of Naira and reduce the purchasing power of individual consumers.
He projected that businesses were going to shut down and those that would be running would be running at negatives, which would lead to an increase in non-performing loans.
According to him, “businesses will not be able to meet up operational costs and at the same time service their existing loans.
“The multiplier effect will be that as businesses are shutting down it will be affecting bank balance sheets because it will increase NPLs.
“All the cash flow analysis that was done by banks before approving existing loans to their customers has been overturned by current realities, especially the hike in energy costs.
“Those cash flow projections were based on the realities at the time they took those loans. At that time, the price of fuel was below N500 but is now above N1, 000. I flew into Uyo on Wednesday and people were buying fuel in my presence for N1, 3000.
“The cost of living has increased and there is no commensurable salary on the part of the workers. Even the new minimum wage has been eroded.”
Another impact on businesses, according to Achoda, was that many corporate organisations could lose the services of their skilled workers who could likely emigrate to foreign countries in search of greener pastures.
Speaking in the same vein, the Chief Executive of De-SME Facilitators Limited, Tony Chinwe, said the implications of petrol price hike for businesses would be multifaceted, very harsh and asphyxiating.
Chinwe, who was the former Group Head of SME Banking, Fidelity Bank Plc, said, “Unlike many countries where electricity is supplied from the public grid, over 90 per cent of MSMES use petrol-powered generators as a source of electricity for their machines and equipment.”
Commenting on the development, Director General, Institute of Directors Nigeria (IOD Nigeria), Dele Alimi, said the high cost of commodities would erode households’ disposable income, adding that businesses should brace up for a corresponding decrease in profit margin as a result of high running cost.
Worried that Nigeria was in dire straits, he suggested a way out for rulers to strike a balance that would put all on the winning side.
“Unfortunately, we cannot blame oil manufacturers. Like any other business, they also sell at prevailing processing costs. They need to operate profitably to remain in business.
“Unfortunately, the government failed to plan properly for subsidy removal which is why we are here. It is disappointing that one year after fuel subsidy removal, what we see is 20 CNG buses distributed to states when ordinarily we should have mass transit business flood major cities”, he asserted.
On his part, President, the Chartered Institute of Taxation of Nigeria, Samuel Agbeluyi, decried another fuel hike at a time when Nigerians were grappling with inflation, unemployment, and a declining standard of living.
He submitted that the decision would exacerbate inflationary pressures.
“Already, transportation costs have surged by approximately 50%. Businesses are struggling to stay afloat, thus the economic strain on citizens would worsen. This situation disproportionately affects low- and middle-income earners, who are already struggling to make ends meet. This, coupled with hike in electricity tariffs compounds this problem, particularly the operational cost of SMEs, which are the backbone of the Nigerian economy”, he expressed.
Also speaking, the Registrar/CEO of the Institute of Chartered Secretaries and Administrators of Nigeria, Babatunde Oladipo Okuneye, said recent hike in fuel price may not be unconnected to the deregulation agenda of the downstream sector of the Nigerian petroleum industry, targeting general good.
He said, “We should expect a reduction in disposable household income which will also impact access to food, healthcare, education, and other household priorities. This will equally exacerbate the plight of the already agonising populace, majority of whom are reeling under the scourge of poverty.”
Considering the almost 100 percent hike in transport fare by commuter buses in response to the recent increment in fuel pump price, many are hitting the road on foot.
In the wake of the new price increment, many motorists have packed their cars at home to join commuter buses, considering that it is economical to do so as fuel is very expensive now, and most regrettably, scarce.
“It has been difficult to go to work since fuel was increased to N850 per litre. I used to spend between N1, 500 to N2, 000 on transportation every day, but I spend double that amount now and my salary is far below N100, 000 a month. I am just working for nothing now,” a lady who introduced herself as Damilola, said.
Obviously, many Nigerians are experiencing difficulties due to the incessant hike in the prices of everything in the country, especially since the beginning of the current administration.
Now, many are paying far more for less units of electricity; far more for less litres of fuel and sadly, far more for less food items.
As the hardship persists, it makes life unbearable for many Nigerians, with many fearing that the air they breathe might not be free soon.
But, having been pushed to the wall, many Nigerians, like Damilola, are now adopting a swim or sink approach as they must survive in spite of the government’s harsh policies.
A laboratory assistant with a private hospital in Lekki Phase 1, Lagos, Akeem Olabode, lamented that the austerity measures, which his father spoke about during the military regime, is back because many cannot survive the high-level inflation in the country, which the recent fuel pump price has worsened, without being frugal in their expenditure.
“Since last week, I have been seeing more people trek some distance to work and to their businesses, even if it is from one bus stop to another, just to save money. If you check, the streets and highways are busier now in the morning and evening when people go and return from work, despite the risk. There is no money, nobody is increasing salaries and even the minimum wage makes no sense again because of the hike in fuel price,” Olabode observed.
The laboratory assistant, who warned that long distance trekking is not good for health, lamented that more people are not coming to hospitals again because of the high cost of healthcare, which he noted would worsen as the economy bites harder and would result in more deaths from ailments that could have been prevented or treated if the cost of accessing healthcare was cheaper.
Part of the survival measures, especially for some workers in Lagos and Abuja, who cannot bear the high cost of transportation, is to stay back in their working places and return home on weekends, while some companies run extended shifts to help junior staff members to save money on the days they are off duty.
“Some of our accounts and IT staff members are staying back in the office nowadays, they claim that there is more work load now, but I know that some of them don’t have money to shuttle every day from Lugbe, Nyanya, Gwagwalada and even as far as Suleja to come to work every day.
“I live near the University of Abuja and I go home only on weekends to save money for family upkeep, school fees and house rent,” an Abuja resident, who simply introduced himself as Ikiri, said.
According to Ndubisi Uchegbu, a civil engineer and CEO of a medium-sized construction company in Aba, Abia State, the country is in survival mode now and that is the only way to go.
“I have told my children who did not experience the structural adjustment programme (SAP) under the military regime that the season of lack is back and we have to weather the storm again by responding accordingly.
“I cannot buy the very high dollars, so foreign universities are out of it, I cannot afford a new car, so we have to maintain and manage our Toyota Highlander 2009 model, we have started attending a closer branch of our church, and my children’s pocket money is half now because food money has far increased,” Uchegbu explained.
Looking at the sad state of the economy, the civil engineer regretted that Nigeria was back to her ugly past for failing to build in the days of plenty and the people have no option than to sadly adjust to the reality of the time.
“One of my friends withdrew two of his children from private to public universities because he can no longer afford almost N5 million tuition fees.
“One of my tenants, who has two cars, sold his SUV last February because of the high cost of everything; from fuel, oil, spare parts, licence and document renewals.
“Again, having a fleet of cars, whether they are exotic or not, invites kidnappers here in Aba.
“Moderate lifestyle is the way to go now or you sink because the economy and this government are not smiling,” he noted.
To survive the hardship, in Port Harcourt, many are moving to areas, especially suburbs where house rent is cheaper.
According to a science teacher in a private school in GRA Port Harcourt, Tega Ovie, many are moving to Obigbo, Aluu, Choba, waterside and other suburbs where rent is cheaper.
“No matter how frugal you are, you cannot run away from spending in today’s Nigeria. Port Harcourt has one of the highest house rents in Nigeria, but those who run away from the city to suburbs because of high rent, end up paying heavily on transportation to the city where the work is.
“The best would have been for your place of work to be closer to your house, but you cannot determine that unless you are an employer,” Ovie said.
In Lagos, many are leaving semi-highbrow areas like Surulere, Ilupeju and some parts of Ikeja further down to suburbs where rent is cheaper.
“When someone says he lives in Lekki or Ajah, ask very well because landlords have used exorbitant house rents (some even in dollars) to push many far from the city. Some live in places that are as far as 50 kilometers from Lekki Phase 1 because they cannot afford rent inside the real Lekki.
“The reality is that people who cannot afford these highbrow areas are no longer pretending again, if they do, the economy will embarrass them. Many are now living where they can afford even if it is a one-bedroom apartment or an uncompleted building,” a banker, Nike Adeoye, said.
Apart from the high rent, the high tuition fees by private schools in the highbrow areas in Lagos, high maintenance and security levies paid by residents in gated estates, are part of the reasons many that cannot afford the good, but expensive lifestyle, are moving to the suburbs.
“To be realistic, most of the exorbitant Ikoyi and Lekki house rents are being paid by companies for their senior staff members, and when they are out of those jobs, they find it difficult to pay, many move to neighbours with cheaper rent. It is all about adjustment and survival and many are fast adjusting to the economic reality today,” Adeoye said.
“One of my friends withdrew two of his children from private to public universities because he can no longer afford almost N5 million tuition fees”
A former Abia lawmaker and an Abuja-based lawyer, Chijioke Umelahi, disclosed that everyone, including the rich, are adopting cost-saving measures now.
“I have curtailed my travels and have resorted to video calls for some issues that require my presence outside Abuja. I have reduced my fleet of cars from four to just two because of the cost of fuel, maintenance and renewal of vehicle particulars now.
“Food is relatively cheap in Abuja, but every other thing is expensive now, so I stay more at home now and only move out when it is business or church on Sundays,” the lawyer said.
To beat the hardship, some families now make out time to buy things in bulk from wholesalers in major markets.
“This time requires buying right and supermarkets and street vendors are out of it. It is always cheaper to buy in bulk. So, I go to the Lagos Trade Fair or Idumota market to buy provisions and save a lot,” Lucy Onoh explained.
However, a public servant and mother of three, Titi Omilani, goes for what her money can afford.
“I know that bulk purchasing saves money, but I am a salary earner, so the only way to beat the hardship is to buy what I can afford. If I cannot buy a family size, I go for medium. It is simply cutting my coat according to my size,” she said.
Omilani has also resorted to doing things around her neighbourhood to save cost.
“My last child attends a school nearby without using a school bus, I worship at a nearby church, which is a walking distance, my hairdresser and mechanic are around my neighbourhood, the market is within. So, I try as much as I can to stay within and it saves me from unnecessary expenses and ensures safety too,” she disclosed.
