Business

Broadening economy as antidote to halting poverty

bilWorld poverty clock, a data on world’s poverty, signposts Nigeria as having half of her population living in extreme poverty. ABDULWAHAB ISA, in this report, reviews the report against anti–poverty policies of government

Poverty is the biggest headache unsettling Nigeria. A hugely populated country by land mass and population size, Nigeria is classified as a top poverty ravaged nations in African continent and the world. By conservative estimate, about 100 million people – roughly half Nigeria’s population – live in extreme poverty. It’s unconventionally stated that four in every 10 Nigerians are poor. Majority of Nigerians can’t afford decent three square meal, unable to afford education, health and other basic requirements that make up decent living. Every regime, past and present, evolved several policies to address rising poverty. None of the policies have sufficiently addressed Nigeria’s endemic poverty level. Year after year, there has been steady progression in poverty affliction. Some school of thoughts locate high rate in social disruptions playing out in the nation such as banditry, armed robbery; kidnapping, insurgency and other dimensional crimes as by-products of systemic poverty confronting the larger segment of Nigeria population.

Poverty clock ticks against Nigeria

As always the case, latest report by world poverty clock, an annual poverty report by Vienna-based non-governmental organization (NGO), World Data Lab, underscores a deepening and escalating poverty level in Nigeria. In its latest poverty report, it confirmed Nigerians living in extreme poverty. The poverty clock provides real time poverty data across countries. According to the latest report posted on its portal, Nigeria, with total population of 205,323,520 people, has 105,097,856, representing 51 per cent living in extreme poverty. Of the number, both male and female make equal number of 51 per cent respectively. The barometer for measuring poverty level of the country indicates that extremely poor Nigerians live below $1.90 or N855 a day. By comparison, this is a further slide in the condition of living of Nigerians as the World Poverty Clock showed that a total of 40.1 per cent of Nigerians lived in extreme poverty as at September 2020. The body said the updated data was carried out, to gauge poverty level aftermath of coronavirus pandemic and its overall economic dislocations. Going by latest report, more men than women have been impoverished in Nigeria. According to available data, about 53,133,553 million men are living below the poverty threshold, while 51,564,303 women are extremely poor. The model also provides a target escape rate that Nigeria must meet to escape extreme poverty. It is set at 0.3 people per second, but Nigeria falls short of this target with -4.4 people escaping poverty per second. The World Poverty Clock was created by the Vienna-based non-governmental organization (NGO), World Data Lab. It was launched in Berlin, Germany, at the Republica Conference in 2017. The organization is funded by the Federal Ministry of Economic Cooperation and Development, Germany.

Covid-19 outbreak as trigger

As a nation, Nigeria is always on the poverty cliff with majority of her citizens lacking basic necessities that make decent living condition. Ironically, Nigeria is among the wealthy and endowed nations on planet earth. Poverty isn’t alien to most Nigerians. However, outbreak of COVID-19, which ravages most countries including Nigeria erased people’s sources of earnings. With the shutdown of businesses – private and public for nearly six months, the pandemic deepened poverty level of average Nigerian. A study on Covid-19 outbreak implications on Nigeria’s economy by World Bank revealed that,m Coronavirus pandemic could make an additional five million Nigerians poor. The bank raised alarm of imminent recession which is expected to be the worst since the 1980s.

The crisis that is the pandemic, as well as the worldwide crash in oil prices, has set the nation on a downward trajectory. While on one hand, the oil crisis has hamstrung the largest crude producer on the African continent, the pandemic is set to further aggravate the extreme poverty level which already stood as the highest in the world. Depending on level of pandemic severity, World Bank forecasts that the Nigerian economy will shrink between 3.2 per cent and 7.4 per cent this year. Where things do get even worse, the recession could continue into 2021 when the economy could contract two per cent, it said. A recent report on Nigeria’s economic development, the World Bank said: “Today’s unprecedented crisis will require an equally unprecedented response from the entire Nigerian public sector (and) private sector to contain the outbreak and protect the lives and livelihoods of low-income and vulnerable communities.” The World Bank had previously projected that two million Nigerians, particularly women, would become impoverished; the newly announced 5 million people that would be faced with poverty comes on top of the previously announced figure. Looting of government warehouses where COVID-19 food stuff were kept by miscreants during # ENDSARS protests across the country, if anything underscored level of hunger, poverty confronting larger population of Nigeria.

Speedy implementation of stimulus funds

COVID-19 induced poverty hits majority of Nigerians. With sources of livelihoods and earnings massively eroded, government came up with series of policies to contain impact of losses. Leading the pack of stimulus intervention funds is the Central Bank of Nigeria, CBN. List of CBN’s Covid-19 intervention funds included N100 billion Targeted Credit Facility (TCF) disbursed by NIRSAL: micro finance bank as parts of containment measure to rein in impact of COVID-19 on economy Eligible participants for N100 billon TCF are households with verifiable evidence of livelihood adversely impacted by COVID-19; existing enterprises with verifiable evidence of business activities adversely affected as a result of the COVID-19, enterprises with bankable plans to take advantage of opportunities arising from the COVID-19. Activities eligible under the scheme include agricultural value chain activities, hospitality (accommodation and food services), health (pharmaceuticals and medical supplies) and airline service providers. Others are, manufacturing/value addition, trading and any other income generating outfits. Other interventions rolled out by the government to cushion impact of COVID-19 on economy include establishment of a N75 billion Nigerian Youth Investment Fund (NYIF) to support enterprise among Nigeria’s 68 million youth between 18 and 35. In addition, federal government launched N3.5 trillion Economic Sustainability Plan (ESP), an intervention designed to revitalize businesses and give new ones lease of life . To achieve the purpose for which ESP was established, CBN advised the federal government to quicken the implementation of its Economic Sustainability Plan (ESP). A speedy implementation of the policy, the CBN said, would help in addressing the structural impediments to growth and job creation as well as improving the poor state of the country’s infrastructure. The Deputy Governor, Financial System Stability Directorate, CBN, Mrs. Aishah Ahmad, gave this advice in her personal statement at the September Monetary Policy Committee (MPC) meeting.

Last line

Reducing poverty entails faithful and sincere implementation of anti-poverty policies enunciated by the government. Ending poverty in Nigeria will entail improving the country’s economic productivity and opportunities for its citizens. This will mean investing in human capital potential and creating jobs for women and young people, increasing financial access and opportunities these groups in rural communities, and advancing technological innovation.

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