The World Bank has sensationally revealed that Nigeria’s growing inflation rate has depleted the existing minimum wage by 55%, and raised the number of poor by five million in 2022.
The Bank released the grim figure during the launch of the Nigeria Development Update for December 2022 Edition, and the Country Economic Memorandum, in Abuja on Thursday.
Nigeria’s current minimum wage is N30,000, which the World Bank has now revalued at N19,355.
The revelation coincided with announcement by the National Bureau of Statistics (NBS) that Nigeria’s inflation in the month of November jumped 21.47 percent, the highest peak in at least 17 years and 10 consecutive growths in 2022.
The rising inflation, the World Bank stressed, is affecting the income of citizens with civil servants and low-income households most hit by the squeeze.
In his presentation, the Bank’s Chief economist for Nigeria, Alex Sienaert, said in real value, the N30,000 is now worth N19,355 ($26), adding that over the past decade, macroeconomic stability has steadily deteriorated, which has eroded growth potential and hindered poverty reduction goal.
He said Nigeria has the potential and resources to accelerate growth and reduce poverty but the current policy framework hinders prospects for economic growth and job creation as issues around multiple exchange rates, protectionist policies, trading restrictions pose barriers.
“If structural reforms are not implemented, Nigeria’s future looks bleak, per capita income will plateau, Nigerians will not have a full time job by 2030 and if the employment rate does not improve, 23 million more Nigerians will live in extreme poverty by 2030,” he said.
Sienaert also reiterated the need for reforms such as the adoption of a single and market reflective exchange rate, elimination of petrol subsidy, reducing insecurity, and increasing non-oil revenues through taxes among others.
“Unlocking private investment can generate economic opportunities for Nigeria’s growing population, accelerating structural transformation and promoting the diversification of its economy,” he stated.