In place of the usual excitement and razzmatazz that usually characterise consumer markets across the country, a gloomy atmosphere appears to have enveloped virtually all the markets that were collectively known to be beehives of activities.
For those that are conversant with consumer markets, particularly in Lagos, shops and markets are always packed with people pushing and shoving to purchase the items they planned for.
Unfortunately, since the leadership of the Central Bank of Nigeria (CBN), embarked on efforts to facilitate the circulation of the newly-redesigned naira notes, particularly as it has launched a cash swap programme across local government areas in Nigeria, the commercial activities of buying and selling have not been seamless, as not a few buyers and sellers have literarily been caught in the web of cashless transactions that are collectively no doubt inherent with myriads of encumbrances.
The difficulties are by each passing day becoming more complicated and cumbersome as the process of cashless transactions is been obstructed by poor bank service networks, exploitative charges made by POS Operators, and scarcity of cash generally across virtually all commercial banks in the country.
Most traders, who sell various consumer items, told our reporter on his visits to notable markets and superstores in Lagos that they were not patronised by buyers, and hence not making good sales as buyers have no new banknotes to make payments for goods that are sold in the market, and service rendered.
As gathered from the visits, there is no denying the fact that the level of patronage observed showed sluggish consumer spending as it ought to during usual market activities, prior to the implementation of the money swap, which commenced a few weeks ago.
Most traders engaged in media parleys bemoaned low human traffic and low patronage while consumers complained of cash squeeze and high cost of wares.
In fact, prices of staple foods and groceries have surged significantly since the implementation of the naira redesign commenced and on election week, on the back of panic-buying, cash drought, and logistic issues.
As gathered, the prices of tomatoes, pepper, onions, potatoes, yam tubers, and rice increased in February 2023 compared to the previous.
Specifically, the price of round-shaped tomatoes increased from an average of N12, 000 recorded in January 2023 to N18, 000 in the review month.
A big bag of onions is sold for an average of N35,000 at Mile 12 market in February 2023, an increase compared to N30, 000 recorded in the previous month.
In the same vein, the price of foreign rice (50kg) has increased to an average of N36, 000 from NN33, 000 while local rice, specifically Big Bull rose to N38,000 from N135k.
A big tuber of yam that was sold for an average of N1400 has risen to N1, 800 on election week; which was last week.
As gathered from various markets, the demand for household food items has risen significantly in the past week, as Nigerians stock up from the election period.
This is following rumours of an intended banking shutdown during the election period, which has been refuted by the Association of Corporate Affairs Managers of Banks (ACAMB), who insisted that banks and their digital channels will be closed to Nigerians during the elections’ queue at malls; long queues at shopping malls and supermarts around Lagos State since the naira swap exercise started coupled with the challenges thrown up by the election week.
The cash-crunch that was no doubt exacerbated by the election week led to panic-buying in anticipation of the presidential elections that were conducted last Saturday.
Also, due to the cash crunch, in the country, Nigerians now have to patronise businesses that accept POS and mobile transfers as means of payment in a bid to avoid the use of physical cash.
Petty businesses in the country are still insistent on the collection of cash, as most of their transactions are in hundreds of naira.
Similarly, not a few Nigerians are finding it difficult to engage in daily commercial activities as most of them were sighted visiting open markets to buy as little as a packet of noodles, to pay using ATMs or transfers.
Again, not a few Nigerians are perplexed with the retrogressive situation that has in no small way induced panic-buying. Traders have explained that logistic issues around traveling from the north to the south have contributed to the price increases.
Mrs. Adaeze Nnorom, a foodstuff seller, said: “The volume of goods coming into the market from the north has reduced due to the naira swap even before the election week, thereby triggering prices of foodstuffs upward.
She added that sellers have increased the cost of their goods, especially for those who prefer a transfer to account for withdrawal charges might expose their accounts to additional charges by the banks.
A rice seller, who preferred to remain anonymous at Ogba market in Lagos lamented that she does not have goods in her store anymore as suppliers have also insisted on cash payments, while customers do not have the cash to pay her. She said, “I don’t have goods anymore in my shop. I don’t have the cash to make purchases, my customers also do not have the cash to pay me, and my shop has remained empty for the past two weeks, due to lack of cash”.
Despite the challenges posed by the implementation of the naira swap, and the sudden rise in consumer goods, consumers have before now been groaning under the weight of inflation.
According to Trading Economy, an online statistics platform, “Nigeria Inflation Rate Unexpectedly Soars to Fresh 17-Year Peak.
“The annual inflation rate in Nigeria accelerated to 21.82% in January 2023, the highest since September 2005, from 21.34% in the prior month, against market expectations of a further slowdown to 21.3%.
Soaring food prices and a weaker naira currency were the main drivers. Prices of food, which is the most relevant in the CPI basket, recorded an upturn to 24.32% in January from 23.75% in the prior month.
The annual core inflation rate, which excludes farm produce, accelerated for the tenth straight month to a 16-year high of 19.2% in January, up from 18.5% in the prior month. On a monthly basis, consumer prices surged by 1.87%, the most in almost 16 years, after a 1.71% increase in the previous month.”
Without a doubt, the bigger problem that presently confronts consumers as far as inflation is concerned is its unsteadiness, however: an inflation rate that is bouncing all over the place, like this one, is usually a sign of a struggling economy, causing prices to fluctuate, and unemployment and poverty to increase.
Nigeria’s economy, a so-called “mixed economy”, which means the market economy, is at least in part regulated by the state, is not entirely in bad shape, though, more than half of its GDP is generated by the services sector, namely telecommunications, and finances, and the country derives a significant share of its state revenues from oil.
Although the lull in sales affected different categories of products, those in foodstuff were worse hit as most traders in the market segment are not conversant with online payment transactions. However, traders that deal in consumables, foodstuffs, beverages, and personal care products are slightly enjoying patronage as many consumers cannot do without the items. They are no doubt indispensable products “
(Daily Independent)
