The consumer price index which measures inflation increased by 11.44% (year-on-year) in December 2018; a 0.16% increase from November’s 11.28%. According to the December 2018 CPI/Inflation report released by the National Bureau of Statistics on Wednesday, all the divisions that contribute to the headline index increased. This is the first time in seven months that inflation would reach such levels. The last time the index was this high was in May 2018 when it was 11.66%. For the states, Bayelsa, Zamfara and Ekiti recorded the highest inflation rate while Cross River, Ogun and Kwara recorded the lowest increase in prices. Food inflation was highest in Abuja, Bayelsa and Nasarawa.

The Central Bank of Nigeria has asked banks to forgo the interest charged on petrol subsidy-induced loans advanced to oil marketers from June 2017 to December 2018. The CBN conveyed the message to banks in a meeting with them and marketers last month, as part of efforts to resolve the outstanding subsidy debts owed by the FG to marketers.

On Sunday 13 January, thugs allegedly loyal to the All Progressives Congress attacked the family home of the Senate President, Bukola Saraki. This was the second attack in four days on the area. The first attack, on 10 January, resulted in injuries to four people. Sunday’s attacked injured at least 11 people and left up to 50 cars destroyed. Witnesses who spoke to Premium Times newspaper claimed that the assailants enjoyed police protection during the rampage and also looted shops and stole motorcycles.

The International Conference of the Great Lakes Region (CIRGL), a 12-member body, including Kinshasa allies Angola and Republic of Congo has called for a recount of the votes in last month’s elections in the DRC. Other foreign powers, including the Southern African Development Community, France, Belgium, Britain and the United States have issued concerns over the vote and warned all parties to resolve their disputes peacefully and respect the will of the people. Meanwhile, the Financial Times of London has reported that its independent analysis comparing manual results collated by Catholic Church observers with electronically fed results from the electoral commission indicate that Martin Fayulu got 59.4% of the votes cast compared to 19% for opposition leader Felix Tshisekedi and 18% for ruling party candidate Emmanuel Shadary.

Commentary

  • Following the release of inflation figures, it is time to talk about inflation. Inflation, which attracts much less attention than either poverty or unemployment, is gradually creeping back up. The most concerning thing about the figures from the NBS is the sustained high level of food inflation, which means that Nigerians, who spend so much on food already, need to continue to spend more. Also, this is an environment where wages are not growing, and in which prices double roughly every five to seven years. Over the last half decade, Nigeria has lingered in a low growth position and has added double-digit inflation position over the last three years. Very urgent policy measures must be taken to address this. However, as we have entered the high political season, we do not expect this to be high on the government’s priority list, so our advice to Nigerians would be to gird their loins.
  • The request by the CBN is positive for the marketers who have invested their resources in the petroleum downstream business as they get some relief. However, this burden has now been passed to the banks, and ultimately their shareholders. This, in our opinion, amounts to a dereliction of responsibilities by a government which previously maintained that there were no fuel subsidies. The government needs to understand that while this may solve some issues regarding its existing debts, it dents the outlook for the petroleum downstream sector.
  • The attack in Kwara speaks to a dangerous trend, especially the allegations of police protection during the incident. It is a well known, and rather unfortunate fact in Nigeria, that law enforcement agents are primarily retained for regime security, and not for the protection of the people. We hope that the new IGP will assign a high priority to address incidents of this nature, bringing perpetrators within and outside the force to book, and coming alive to the police’s responsibility to Nigerians.
  • In one of the more unusual political developments in the continent’s substantial dalliance with less-than-desirable electoral management, there has been a chorus of dismay with an election result where the opposition candidate won, both domestically and internationally. The Catholic Church has documented what it called widespread incidences of voter intimidation and electoral malpractice while the United Nations says ethnic violence in Mai-Ndombe Province, in the west of the country, left at least 890 dead over just three days last month. Voting there, as well as in Beni and Butembo in eastern North Kivu Province, was postponed until March by the electoral commission because of insecurity and an Ebola outbreak. Politically, Mr Fayulu filed an appeal in the Constitutional Court on Saturday demanding a manual recount and alleging that Mr Tshisekedi made a deal with outgoing President Joseph Kabila. With all of this is playing out, the political situation will remain tetchy, putting a stillbirth to the country’s first orderly transfer of power since independence from Belgium in 1960.