More than 100 employees have been promoted across its global operations, with one-time economic relief payment also introduced for all staff worldwide. 

In Nigeria, employees will receive additional tax support and cost-of-living adjustments following recent regulatory changes affecting take-home pay.

The decision also results from high living costs across key markets, including Nigeria, where inflation stood at 15.69% in April 2026. 

Food inflation was recorded at 16.06% in the same period. Fuel prices have also surged, with petrol selling at about ₦1,532.93 per litre, adding pressure to transport and daily expenses.

“I often say our people are our secret sauce,” Olugbenga “GB” Agboola, Flutterwave founder and CEO said. “They are the ultimate engine behind everything we build, giving us the capacity to create solutions that power businesses, unlock opportunities, and move money seamlessly across Africa and beyond.”

The company said the latest support measures are part of its approach to staff welfare and retention. It added that it wants employees to focus on work without constant financial strain.

Annette Akpolo, head of People and Culture at Flutterwave, said the approach combines individual performance with better staff support.

“Our goal has always been to build an environment where our people can focus on doing their best work, rather than being weighed down by economic anxiety,” Akpolo said. 

“Pairing merit-based individual growth with supporting the collective needs of the whole team are both essential parts of how we build a company culture where people genuinely want to stay and grow over the long term.”

Founded in 2016, Flutterwave marks its tenth year in 2026. The company said it has now processed over 1 billion transactions and moved more than $40 billion in total payment value globally.

Flutterwace also reported strong recent growth, including a 289% increase in wallet-based collections by transaction count and a 184% rise in bank transfer value over the past year. The company attributed this to wider use of local payment methods across its markets.

The announcement comes as Nigeria’s fintech sector competes for skilled talent. Firms such as Paystack and Interswitch are also expanding, while companies adjust pay and benefits to retain staff under rising cost pressures.

At Flutterwave, leadership said growth remains tied to performance and contribution.

“At Flutterwave, growth is earned through meaningful contributions to the business and to the mission we are building together,” Agboola said. “As we continue to grow, the people who will shape our future are those who consistently step up, solve hard problems, support others, and move the company forward.”

According to Risevest’s newly released 2025 Cost of Living Report, 73% of Nigerians earn below ₦500,000 monthly, while similar income pressures persist across Ghana, Kenya, and Uganda.

The survey, which gathered over 19,800 responses across 12 countries, paints a picture of a continent no longer reacting to crisis, but actively redesigning financial behaviour.

From cutting non-essential spending to prioritising dollar-denominated investments, Africans are choosing discipline over panic.

“In every percentage, there is a real person making sense of change,” said Eneyi Obi, chief marketing officer at Risevest. “This year’s report shows Africans are not just reacting to the cost of living; they are redefining what financial resilience looks like.”

While headline inflation numbers have improved in key markets, everyday expenses, food, rent, transport, education, continue to absorb a large share of household income.

The report finds that income inequality remains deeply entrenched, with median earnings significantly lower than averages across all surveyed countries.

Yet, optimism is not absent. The report highlights a rise in intentional money habits, increased interest in alternative income streams, and a growing appetite for long-term investments that protect against inflation.

“The story is not just how much life costs,” Obi added, “but how people are adapting with creativity and quiet strength.”

68% of Young Africans Cut Non-Essentials

For Gen Zs and millennials across Africa, the cost of living crisis has become a crash course in financial discipline.

The Risevest’s 2025 report indicates that a majority of young earners now prioritise essentials, track expenses more closely, and delay lifestyle upgrades.

In Nigeria alone, over 25% of respondents earn between ₦200,000 and ₦499,999, a group described as the “planning class”, freelancers, tech workers, and young professionals who budget carefully and increasingly save in foreign currencies.

Across Kenya and Ghana, similar patterns emerge. 68.88% of Kenyan respondents earn below KES 50,000, while 83.65% of Ghanaians earn below GHS 50,000, pushing young people to explore side hustles, remote work, and digital investments.

“This generation is more intentional than ever,” said Eneyi Obi. “They’re not just trying to survive inflation; they’re learning how to build stability with the tools available to them.”

The report notes that for many young Africans, wealth creation is no longer about luxury, it’s about security, flexibility, and future-proofing income.

Moniepoint’s 2025 Informal Economy Report reveals what most Nigerians already live, small businesses are earning more but gaining less.

Sixty-five percent of Nigeria’s informal businesses across the country reported an increase in revenue over the past year, but only 47% saw a growth in profit. At the same time, 79% said the cost of doing business had increased, driven mainly by higher supplier prices, transport expenses, and the relentless depreciation of the naira.

This contradiction, of higher earnings but shrinking returns, captures the state of the Nigerian economy today.

Growth Without Profits

The country’s informal economy looks alive. The markets are filled with activities, goods are moving daily, artisans are finding work, and service providers are busy, but look deeper, they are all exhausted. 

The report stresses how traders, among others, watch their margins evaporate, unable to keep pace with inflation. “The cost of doing business has increased for 80% of informal businesses in that same period. A goal for us in this report was to establish context like this: helping key stakeholders see and understand the effects of every decision made on informal businesses, and giving them a voice where they’ve previously gone largely unheard,” said Tosin Eniolorunda, founder and group CEO, Moniepoint Inc.

Unsurprisingly, 44% of Nigeria’s informal businesses make less than ₦20,000 daily in revenue, and most make profit of only ₦10,000 to ₦20,000 a day. Business owners skip meals to restock, workers forgo pay to keep their jobs.

And for women-owned businesses, 41% of women earn below ₦10,000 daily, compared to 34% of men. It tells us that Nigeria’s informal economy, while inclusive in appearance, still aligns with the inequalities of the formal one.

Survival Mode Economics

We see an economy built on individuals, isolated, unstructured and overstretched, highly fragmented. Eighty-five percent of informal businesses are sole proprietorships, usually run by one person who handles everything from supply to sales to bookkeeping. Only 40% employ labour, and when they do, it’s typically one to three workers. It’s not that they don’t want to expand, it’s just that they can’t afford to.

Record keeping is also informal. Seventy-five percent of business owners say they track their income and expenses, but 38% disclose they do so mentally, without written or digital records. Most lack a clear view of their cash flow, making them invisible to lenders and policymakers.

That lack of structure limits access to credit, planning, and long-term growth.

Credit access is also deteriorating as 51% of informal business owners have never taken a loan and have no intention to do so, compared to 30% in the last report.

Fear of debt, high interest rates, and lack of collateral keep them shut out of the financial system. Among those who borrow, only 6% have ever secured loans above ₦1 million, with digital lenders and microfinance banks emerging as their most common sources.

The result is a self-sustaining cycle of informality; low records, low credit, low growth.

Inflation and the Cost of Resilience

Inflation has become the most punishing cost of doing business in Nigeria. It’s the invisible tax that eats into every sale, every restock and every saving. 

Dr Nurudeen Abubakar Zauro, technical adviser to the President on Economic and Financial Inclusion, explained:

“With the removal of fuel subsidies and devaluation of the Naira by the monetary authorities, inflation rate increased from 22.41% in May 2023 to a climax of 34.8% by December 2024 according to the data from the National Bureau of Statistics (NBS). In July 2025, inflation rate declined drastically to 21.88%.”

For informal businesses, that drop brings a little comfort. Inflation may have eased statistically, but prices are still suffocating. The report found that while 74% of business owners save money, 69% save less than ₦50,000 monthly, and 42% say their savings cannot last a month if their business income stops.

Even the much-celebrated digital transition has not fully arrived. While many businesses use transfers to restock, most still prefer to receive payments in cash, and only 16% say digital transactions account for more than half of their total revenue. The infrastructure may be modern, but consumer behaviour is still very traditional and survival rarely leaves room for experimentation.

Policy and Structural Limitations

For an economy that contributes around 65% of the nation’s GDP and supports over 80% of jobs, the informal sector is strangely underserved by policy. It sustains Nigeria, but without protection. 

Dr Chinyere Almona, director-general of the Lagos Chamber of Commerce and Industry, noted:

“The most pressing challenge, therefore, is misaligned policy frameworks that inadequately balance revenue generation with sectoral resilience, inadvertently driving many players further into informality. What is needed is not merely regulation, but coherent regulatory empathy, a framework that recognises informality as a springboard for innovation, employment, and resilience, rather than a nuisance to be managed.”

Despite recent policy initiatives such as the Nigeria Consumer Credit Corporation (CrediCorp), the Nigeria Tax Administration Act (NTAA), and small business registration campaigns, the report disclosed that formalisation is still out of reach for most small business owners, expensive, bureaucratic and unrewarding. 

“Although many informal businesses are unfamiliar with the process of registering their business, the assumption is that it is costly and complex. These assumptions make them unlikely to attempt the process,” said Zauro.

It’s not a lack of will, but a lack of trust. 

From Resilience to Reform

If there’s one thread that ties Moniepoint’s findings together, it’s that resilience is not enough. The informal sector needs access, not a round of applause.

In her commentary, Dr. Almona called for a shift in thinking. “Policies must pivot from punitive compliance models to incentive-driven, inclusion-focused strategies to effectively support growth and formalisation.”

That means simplifying registration, improving access to finance, expanding digital infrastructure, and providing targeted support for women entrepreneurs; all areas where private sector players like Moniepoint, SMEDAN, and IFC are already collaborating and this must continue in order to bridge the trust gap between the street and the system. 

Moniepoint’s report measures Nigeria’s informal economy, exposing its weaknesses and the fatigue of millions of businesses. Nigerians are counting coins under candlelight, calculating what can wait till tomorrow. Informal businesses are the backbone of the economy, but they’re carrying too much weight without support.

Until policymakers, financiers, and regulators begin to design for their reality, not their assumptions, Nigeria’s growth will stay uneven. The country’s entrepreneurs are doing their part. It’s time the system met them halfway.

But 2025 has set a new record. This year, rams were priced as high as ₦750,000 to ₦1 million in many parts of Nigeria. What was once a religious and cultural celebration has turned into a financial burden for millions and its not just high prices we are dealing with, but the full impact of economic instability on daily life.

The Rise and Rise of Ram Prices

In just two years, the price of a mid-sized ram has jumped by over 400%, with Traders blaming insecurity in livestock-producing regions, higher costs of transport and feed prices.

On a broader scale, we see the naira has lost huge value, insecurity in Northern states like Zamfara and Katsina has disrupted supply chains, the cost of diesel and petrol has made moving goods across states nearly unaffordable, livestock traders are also dealing with new levies and multiple taxes across state borders. 

These factors combined have pushed livestock prices to levels that most Nigerians simply cannot afford.

Cutting Back on Celebrations

Many families have adjusted, some bought chickens or goats, others did nothing at all. For the first time in decades, Sallah passed in several households without the smell of grilled ram or the sound of children knocking on neighbours’ doors for meat.

Beyond food, this shows a growing economic divide. Those who can afford to celebrate still do, but those who can’t are finding ways to keep the spirit of the holiday alive, even if it means stepping away from long-held customs.

Effects on Traders and Retailers

The effects are being felt in the markets. Retailers reported slower sales in the weeks leading up to Sallah. Some deliberately reduced their stock, unsure of whether people would actually buy. 

Traders dealing in fabric, perfumes, shoes, and non-essential goods say the usual Sallah rush never came, the demand wasn’t there.

For many, income is stagnant or shrinking, salaries don’t match rising costs, and purchasing power is falling. Traders are adapting by reducing inventory, slashing profit margins, or offering instalment payments, moves that weren’t common even a year ago.

Digital Payments: A Useful but Limited Tool

The fee waivers and cashback promotions already offered by several digital payment platforms, including Opay, Kuda and PalmPay, helped this period. Users utilised these platforms mode to reduce friction at checkout points, encouraging users to send money to family members or pay merchants without needing physical cash or being scared of network failure.

However, the larger issue was that people didn’t have enough money. Technology can make transactions easier, but it doesn’t address the root causes of poverty or inflation. Many fintech platforms are also dealing with increased costs of operations, and we can’t tell how long these discounts can be sustained.

What about Logistics?

For businesses that rely on logistics, this Sallah was a test, with high petrol prices and deteriorating road conditions, delivery companies had to rethink their operations. 

Some cut back on service hours, others switched to using public transport systems for short-range deliveries, particularly within city centres like Lagos and Abuja.

Riders, who typically earn based on completed trips, saw a decline in volume. To retain them, some companies introduced bonuses, free maintenance support, or performance-based fuel subsidies. 

These measures helped, but only in the short term. The bigger challenge of how to deliver effectively in an environment where fuel prices are explosive and consumer demand is unsteady.

The Search for Alternatives

A few logistics companies like Max.ng and Bolt are now experimenting with electric and battery-powered vehicles, aiming to reduce dependency on fuel and stabilise costs of operations, but the transition is slow. 

Charging infrastructure is limited, and the upfront cost of electric vehicles is still high for small businesses.

Nonetheless, there’s thriving interest. If the current fuel pricing structure keeps up, we may see higher adoption of electric vehicles in Nigeria’s logistics space in the next two to three years.

What We’ve Learned from Sallah 2025

This year’s Sallah has shown us how quickly economic conditions can change long-standing cultural patterns. We’ve been forced to adapt under pressure, overlooking the rams for celebrations. 

The middle class, which once anchored consumer spending during festive periods, is being squeezed from both ends. Small businesses are struggling with falling demand and while digital platforms provide short-term ease, they don’t solve long-term affordability issues.

More than anything, Sallah 2025 reveals that the gap between tradition and reality is getting wider. And unless there is serious policy intervention, particularly around food supply, transport costs, and job creation, subsequent celebrations may become even more subdued.

Can We Still Afford to Celebrate?

Festivities used to be a time for joy and unity. Now, they remind us of what many can no longer afford. The government needs to take a serious look at the high cost of living and its long-term impact on social cohesion. 

Businesses, too, must prepare for a phase where consumer spending is lower, more cautious, and more selective.

Reflecting on this year’s Sallah has left me looking beyond if we could afford rams, can we afford to continue as we are?

The study, conducted by Hostinger, analysed publicly available data to assess how well each city supports independent workers.

Miami Tops the List with Strong Earnings and Zero Self-Employment Tax

With a freelance workforce making up nearly 46% of its total workers, Miami scored the highest in the ranking, with a tax-friendly environment—freelancers in Miami pay no self-employment tax. Again, it offers 433 co-working spaces and an average freelance income of $45,610.

Las Vegas followed in second place, providing some of the highest freelance earnings in the country at $50,056 per worker. With no state income tax and an affordable cost of living, the city presents a financially stable option for independent professionals.

Nashville, San Francisco, and Boston Round Out the Top Five

Nashville took third place, benefiting from high internet speeds (3,317 Mbps) and no self-employment tax. The city’s affordability and growing freelance population contributed to its strong ranking.

San Francisco, despite its high living costs, ranked fourth due to its lucrative freelance opportunities. Freelancers in the city earn an average of $51,903, the highest on the list, thanks to its thriving tech and innovation sectors.

Boston secured fifth place, with nearly 20% of its workforce engaged in freelance work. The city provides freelancers with 172 co-working spaces and diverse professional opportunities, making it a prime location for career growth.

Los Angeles Has the Largest Freelance Workforce

In sixth place, Los Angeles stood out for having the largest freelance workforce in the study, with over 431,614 independent workers. The city also recorded the highest total freelance revenue, surpassing $20 billion. With 805 co-working spaces—the most of any city—Los Angeles offers a vibrant network for freelancers.

Austin ranked seventh, leading in co-working spaces with 569 options. Its lower cost of living and growing freelance community make it an increasingly popular choice.

Philadelphia, Houston, and Denver Complete the Top Ten

Philadelphia, in eighth place, provides a cost-effective option for freelancers, with access to 153 co-working spaces and industries like healthcare, education, and finance.

Houston ranked ninth, offering no self-employment tax and an affordable cost of living. The city’s freelance community continues to expand, particularly in sectors such as energy and healthcare.

Denver rounded out the top ten, attracting freelancers with its balanced work-life environment and increasing professional opportunities.

Factors That Make a City Freelancer-Friendly

According to a Hostinger spokesperson, cities that offer financial advantages and professional support systems tend to attract more freelancers.

“Freelancers succeed in cities that are affordable, provide strong earning potential, and accessible resources. Low taxes and abundant co-working spaces directly support independent professionals, while diverse industries create consistent opportunities for work. Cities with high income potential and manageable living costs enable freelancers to grow their careers and maintain a better quality of life.”

For freelancers looking for the best places to thrive, Miami, Las Vegas, and Nashville are top choices with a combination of strong earnings, low taxes, and access to co-working spaces.

The proposed budget is a 41.91% increase from the ₦35.05 trillion allocated in 2024 (₦28.7 trillion initial budget plus ₦6.2 trillion supplementary budget).

Prioritising defence and security (9.87%), followed by infrastructure (8.16%), education (7.08%), and health (4.99%), the 2025 budget reiterates the government’s economic vision, particularly in tackling insecurity, which has negatively impacted business operations, investor confidence, and agricultural productivity, leading to rising food prices and high poverty rate.

The government has projected ₦36.35 trillion in revenue (up from ₦25.9 trillion in 2024) while budgeting an aggregate expenditure of ₦49.74 trillion, resulting in a deficit of ₦13.39 trillion. Revenue is expected to come from both oil and non-oil sources.

An important component of the budget is tax reform, which includes nearly doubling VAT from 7.5% to 12.5% by 2026, although essential goods like food and medicine will remain exempt.

The government also aims to boost revenue through tax administration improvements and agency restructuring, with the Federal Inland Revenue Service (FIRS) and Nigerian Customs Service (NCS) playing key roles.

However, these revenue targets could have huge implications for businesses and consumers.

Impact on Businesses

The budget’s increased focus on defence and security (9.87%) points to a commitment in addressing insecurity, which could improve the business climate, reduce operational risks, and boost investor confidence.

Again, higher capital expenditure on infrastructure may lower logistics and production costs in the long term.

However, several challenges remain:

• Higher Taxes on Businesses: A VAT increase (to 12.5% as proposed) will raise costs for businesses dealing in non-exempt goods and services. Companies will either absorb these costs or pass them on to consumers, potentially reducing demand.
• Increased Compliance Costs: Businesses will need to adjust tax reporting systems to comply with new tax rules, leading to additional operational expenses.
• Rising Borrowing Costs: The CBN’s monetary tightening policies have resulted in higher interest rates, making it more expensive for businesses to finance expansion. This could slow investment and economic growth.
• Telecom Sector Impact: The 50% increase in telecommunications tariffs will also raise operational costs for businesses dependent on digital services, affecting sectors such as fintech, e-commerce, and tech startups.

Impact on Consumers

1. Increased Cost of Living:

• While VAT exemptions cover essential goods, prices for non-exempt items (about 18% of goods and services) will rise, reducing disposable income and increasing poverty risks.

2. High Inflation Concerns:

• The budget targets an inflation drop from 34.6% to 15%, but given existing economic pressures, achieving this may be difficult in the short term. Until inflation is contained, consumers will continue facing rising costs for essential goods and services.

3. Rising Telecom Costs:

• A 50% increase in telecom tariffs will impact mobile users, businesses, and digital services, making internet access more expensive and reducing affordability for low-income consumers.

2025 Budget: Broader Economic Consequences

The 2025-2027 Medium-Term Expenditure Framework (MTEF) projects that 56.3% of revenue will come from oil, while 43.7% will be generated from non-oil sources, primarily taxation.

Key economic assumptions include:

• GDP growth rate increase
• Inflation decrease to 15%
• Exchange rate at ₦1,500/$1
• Oil price at $75 per barrel
• Crude oil production at 2.06 million barrels per day

However, oil revenue targets are vulnerable to pipeline vandalism, oil theft, and refinery inefficiencies. Addressing these issues is essential for meeting the revenue projections.

Similarly, foreign exchange pressures, high energy costs, and increased interest rates remain major challenges for businesses and consumers.

Improving energy infrastructure and forex stability will be essential to reducing the cost of living and enhancing Nigeria’s economic resilience.

While the 2025 budget seeks to stabilise Nigeria’s economy through higher revenue generation and increased security spending, its impact on businesses and consumers will largely depend on effective policy implementation, tax efficiency, and inflation control.

Without these, high costs, regulatory burdens, and economic uncertainty may overshadow the intended benefits.

The NBS report revealed that the November inflation rate was 6.4 percentage points higher than the 28.2% recorded in the same month last year. 

The month-on-month inflation rate for November also increased by 0.72%, further weakening the purchasing power of Nigerians already facing high costs of living.

Food inflation, a big component of the CPI, reached 39.93% on a year-on-year basis, up from 32.84% in November 2023. 

On a monthly basis, food inflation edged up to 2.98% from 2.94% in October 2024. The steep rise was driven by high prices of essential items such as rice, yam flour, millet, dried fish, goat meat, and powdered milk.

The report attributed the high inflation to supply chain disruptions, rising transportation costs, and the lingering effects of policy reforms. For many households, this has translated into a severe cost-of-living crisis, with basic necessities increasingly out of reach.

Economic analysts trace much of the inflation surge to policy decisions taken by President Bola Tinubu’s administration. 

Upon assuming office in May 2023, Tinubu removed the petrol subsidy and floated the naira, leading to a sharp increase in petrol prices—from under ₦200 per litre to over ₦1,100 in some regions—and a steep depreciation of the naira, which now trades at over ₦1,600 to the dollar.

While international financial institutions like the World Bank and IMF had long called for these reforms to stabilise Nigeria’s economy, the immediate fallout has been a spike in inflation and widespread hardship for citizens. 

The removal of subsidies, coupled with volatile exchange rates, has made energy, transportation, and imported goods considerably more expensive.

With inflation continuing its upward growth, experts warn of far-reaching implications for the nation’s economy and social stability. 

The cost of living has eroded disposable income and deepened poverty levels across Nigeria. Meanwhile, calls for the government to cushion the effects of its reforms through targeted social programmes and fiscal interventions have grown louder.

The inflation rate also brings a challenge to monetary authorities. The Central Bank of Nigeria (CBN) may face increasing pressure to tighten monetary policy, despite issues about the possible impact on borrowing costs and economic growth.

For millions of Nigerians, the hope is that policymakers will strike a balance between necessary reforms and measures that protect the most vulnerable populations.

The buzz is everywhere and many are wondering why the naira is even being compared to the dollar since federal workers who initially earned the previous minimum wage of ₦30,000 are seemingly overjoyed.

But before you query further, look at today’s Nigeria, where the dollar plays an outsized role, affecting everything from the price of bread to rent. 

In 2014, Nigeria was Africa’s largest economy with a GDP of $568.5 billion. South Africa followed with $381.2 billion, Egypt with $321.6 billion, Algeria with $238.9 billion, and Angola with $145.7 billion. 

By 2023, Egypt rose to the top with $393.9 billion, South Africa maintained a close second with $377.7 billion, and Nigeria dropped to third with $374.9 billion. Algeria and Ethiopia followed with $244.7 billion and $159.7 billion, respectively. 

For 2024 estimates, South Africa’s economy became number one with $373.2 billion, Egypt at $347.6 billion, Algeria at $266.8 billion, Nigeria at $252.7 billion, and Ethiopia at $205.1 billion. This is according to data from StatiSense.

Also, the purchasing power of Nigeria’s minimum wage in terms of petrol (PMS) has seen a severe decline over the years. In 1999, a minimum wage of ₦3,000 could buy 150 litres of petrol. By 2000, an increased wage of ₦7,500 could purchase 341 litres. In 2011, with a wage of ₦18,000, workers could afford 277 litres. 

However, in 2019, despite a wage rise to ₦30,000, the purchasing capacity fell to 206 litres. In 2024, the new minimum wage of ₦70,000 only buys 93 litres of petrol, reflecting the huge impact of inflation and rising fuel prices on the real value of wages. What’s really happening?

The answer isn’t so simple. This new wage stacks up against the ever-rising cost of living, impacting businesses and the economy at large, and how Nigeria compares with other African countries.

There are complexities of wages and the never-ending issue of a better life in Nigeria, still, the dollar feels like gold. 

In the midst of all this, Aliko Dangote has halted his steel production plans following monopoly accusations from President Tinubu. We’ll get to that later. 

Striking a Balance: Navigating Nigeria’s Minimum Wage Debate for Economic Prosperity, Social Equity

Looking at Nigeria’s previous minimum wage, set at ₦30,000 per month, was established in 2019. At that time, the economy was facing low growth rates, high unemployment, and inflation, but not at a level as high as today. Inflation then was 11.40%, but today, it stands at 34.19%. 

The primary objective of the wage increase was to enhance the purchasing power of workers, reduce poverty, and stimulate economic activity, but things have gotten worse ever since.

The current agreement, according to the Nigeria Labour Congress (NLC), comprises a commitment to review the minimum wage every three years rather than every five years. 

This means the President will now adjust wages more frequently to keep up with inflation and economic conditions.

Cost of Living Analysis

To understand the impact of the new minimum wage, it’s essential to analyse the cost of essential goods and services before and after its implementation:

The price of foods such as rice, beans, and bread has greatly increased. For instance, as of July 18, 2024, a 50kg bag of high-quality rice costs ₦87,000 in Abuja, while it ranged between ₦78,000 to ₦85,000 in Lagos, Jos, Ilorin, Ibadan and Port Harcourt, among other states. 

This is a huge difference to earlier prices in 2019 where a 50kg bag of rice cost around ₦21,000. Even a loaf of bread is now as high as ₦2,000.

Rent prices have surged, particularly in urban areas. A one-bedroom apartment that rented for ₦200,000 annually in 2019 now ranges between about ₦500,000 to ₦1.5 million in Lagos State depending on the location.

Public transportation fares have doubled due to higher fuel costs. A bus ride that used to cost ₦100 now demands ₦300 and above.

The cost of healthcare services and medications has also risen sharply, making it more challenging for low-income earners to afford necessary treatments.

These increases show a big gap between wage growth and the rising cost of living, leading us to wonder about the real value of the new minimum wage.

Purchasing Power Comparison

Adjusting for inflation and the devaluation of the naira, the real value of the new minimum wage reveals its purchasing power. 

In 2011, the minimum wage was ₦18,000, equivalent to $117. By 2019, the wage had increased to ₦30,000, but due to currency devaluation, it was worth $98. Currently, the ₦70,000 wage, using the Central Bank of Nigeria’s exchange rate of ₦1,584 per US dollar, amounts to approximately $44.2. This figure is lower than expected, particularly considering the high cost of living in Nigeria.

For context, the price of a tuber of yam in the South East ranges from ₦7,000 to ₦12,000, depending on its size. The devaluation of the naira has unfortunately diminished the purchasing power of the new minimum wage. 

An analysis of the Nigeria Foreign Exchange Market (NFEM) reveals a decline in the naira’s value, making it difficult for workers to afford basic necessities despite the increased minimum wage.

Seeking individuals’ views, Lade, a single mother of two, works as a cleaner in Lagos. Despite the wage increase, she finds it hard to cover basic expenses. “The rent alone takes up more than half of my salary. After paying for food and school fees, there’s nothing left for emergencies. The new wage will help, but just a little, because everything has tripled currently.”

Emeka, a factory worker also says the new wage helps a bit, “but with the cost of everything going up, it feels like I’m running in place. It’s hard to save or plan for the future.”

Despite the wage hike, the price hike is unchanging. 

Nigeria’s Inflation Rate Up 34.19 % Amid Rising Cost of Living

International Comparison

Comparing Nigeria’s new minimum wage with those of similar countries gives us more insights. For instance, in South Africa, the minimum wage is about $248 per month, adjusted for purchasing power parity. In Ivory Coast, the wage is $125, in Togo it is $87, in Benin Republic, it stands at $86, Senegal at $75, Kenya at $116, Cameroon at $70, Morocco at $286, and in Seychelles, the highest, at $464.

Can you see that the purchasing power in Nigeria remains insufficient? 

For businesses, higher wages mean increased operating costs, which could lead to higher prices for goods and services. This, in turn, might contribute to inflationary pressures.

From an employment perspective, some businesses may struggle to absorb the increased labour costs, potentially leading to layoffs or reduced hiring. 

On the positive side, higher wages could boost consumer spending, driving economic growth and potentially creating more jobs in the long run.

But without corresponding productivity gains and economic reforms, the benefits may be short-lived.

For How Long Shall This Continue?

Robert Nesta Marley, the Jamaican social-political prophet, in his evergreen album “Redemption Song” released in 1980, must have thought about the prevailing ills of his time when he released a strong lyric that goes, “How long shall we kill our prophets while we stand aside and look?” With the accuracy of a Jewish prophet, Marley advanced the cause for redemption as indicated by the song’s title.

In the context of religion, a prophet sees ahead, predicts, and prescribes solutions. In business and entrepreneurial parlance, we believe “prophets” find solutions to pending situations, create opportunities when there are none, and subsequently ameliorate challenges for the people. 

Africa and Nigeria have been blessed with many such individuals, and it would be right to assert that Alhaji Aliko Dangote falls within this class by virtue of his investments and entrepreneurial wizardry.

The controversies that have surrounded the Dangote refinery, from scepticism and impossibilities envisioned by some armchair theorists and self-acclaimed social analysts, reflect this. 

Dubbed the eighth wonder of the world, with a production capacity of 650,000 barrels per day, the Dangote Refinery should prompt every serious person of African descent to interrogate what exactly our problems are and what we want as a people, despite campaigns of calumny from certain quarters.

Before the Dangote Refinery began operations, the Dangote Group was the highest employer of labour in Nigeria outside the federal government. It is a conglomerate with diverse interests in sectors such as cement, petrochemicals, sugar, flour, and salt production. 

The company employs over 50,000 workers across its different subsidiaries, and this is expected to increase with the Dangote Refinery, the largest in sub-Saharan Africa. 

According to information released six days ago, the $19 billion Dangote Refinery, reputed to be the largest in Africa and Europe, employs over 3,000 people. The fertilizer plant alone employs close to 1,500 directly and another 5,000 indirectly. 

While the politics surrounding the Dangote Refinery remain unclear, what is crystal clear is that it has generated employment opportunities and put food on the table for many, despite Nigeria’s hostile operating environment.

In the same vein, it is my firm belief that the proposed steel production, which was called off on the grounds of monopolising every aspect of the economy, after expressing readiness about a month ago, calls for serious soul-searching questions. 

There is no doubt that steel plays a vital role in the modern world. It is one of the most important materials for building and infrastructure, enabling a wide range of manufacturing activities and creating opportunities for innovative solutions in other sectors. It is also indispensable in research and development projects worldwide. 

Furthermore, a functional steel industry will serve as the backbone of Nigeria’s industrialisation if all the necessary parameters are put in place. The benefits of having a functional steel industry will translate to a functional country. 

The steel industry will contribute to all facets of the economy, including the important role it plays in economic development and growth, its multiplier effects in the development and sustenance of agriculture, healthcare, and virtually every other sector.

Dangote Halts Investment Plans in Nigeria’s Steel Industry

Are there records of remarkable breakthroughs in Nigeria’s steel industry yet? 

About eight months ago, the Federal Government of Nigeria allocated N4.45 billion to the moribund Ajaokuta Steel Company in the 2024 budget, seeking N35 billion from funding institutions to revive the light steel mill in the Ajaokuta Steel Plant, which has been dormant for over 42 years. 

It is significant to note that N4.45 billion for 2024 is higher than the N3.71 billion allocated to the company in 2023. However, juxtaposing the expenditure wasted by the federal government over the years with the trivial gains accrued from the industry, one could have envisioned that proposed steel production by Africa’s richest man would have brought succour or engineered a good start for private investors and entrepreneurs alike. But alas, the African billionaire has called off the initiative on the basis of being called a monopolist.

Much More than the Monopolist Claim

According to the Indian Economic Times, a monopoly market structure is characterised by a single seller selling a unique product in the market. 

In a monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute. Factors like government licenses, ownership of resources, copyrights and patents, and high starting costs make an entity a single seller of goods. 

All these factors restrict the entry of other sellers into the market. Monopolies also possess some information that is not known to other sellers.

But the last time we checked, the government has not given anyone an exclusive right to venture into the steel industry. It seems to be like the Yoruba saying, “eni to ba la ya ko wa wo,” translated to English: “If you have the grit and expertise, you can venture.” 

Could it be that the constant frustration meted out by international oil companies and the supposed internal conspiracies experienced at the Dangote Refinery were covered up with something else?

Minus investment in the steel industry, plus the ₦70,000 new minimum wage, all you have is suffering and smiling.

Let’s say the monopoly justification adduced by Alhaji Dangote is something to go by. We are convinced that investment in the sector would have boosted employment opportunities for the teeming unemployed citizens in Nigeria. 

The question is, having witnessed the mass exodus of multinationals—up to the tune of 800 companies, with several others without clear records—are we supposed to have frustrated the good gesture of the entrepreneur? 

Like Microsoft, Apple, and Nvidia of this world, ours can start by providing a soft landing for the takeoff of conglomerates, not discouraging them in any way.

As a matter of fact, entrepreneurs in Nigeria are the real VIPs and should be treated as such. While we may be tempted to toe the line of the African billionaire on the basis of the monopoly alibi, we are sure that the birth of a steel industry would have at least paid more than the much-celebrated increase to N70,000 minimum wage. 

Whether the recipients of the minimum wage can lead a good life is still a long discussion, and we may need to wait and see how it pans out. 

If you can’t eat rice alone, the Iyaloja market already indicates that a big basket of tomatoes goes for ₦120,000. I will leave you with the prices of meat, fish, red oil, and a standard apartment in Nigeria. Then the question arises: how far can the minimum wage go?

Therefore, in line with the thought of Alhaji Aliko Dangote, we wish other daring African entrepreneurs who wish to venture into the steel industry the very best. 

Rounding off this piece, news just came in indicating Dangote’s interest in selling off the refinery, still on the basis of being dubbed a monopolist. We wait earnestly as events begin to unfold in the forthcoming days.