Prices and inflation in Nigeria - statistics & facts
In 2021, Nigeria recorded one of the highest inflation rates in the world at around 17 percent. Higher inflation rates are typically more present in emerging economies. There are several reasons for this. Emerging economies are likely to grow faster, leading to an increase in demand for goods and services. However, when the demand increases but the supply stays the same, prices might increase, leading to inflation. Another factor that plays a role is the lack of a well-established monetary policy. This can turn into manipulation of the currency in order to achieve short-term goals, for instance to decrease the cost of exports. In addition, the excess of money printing presses the currency downward and pushes the inflation higher.
In Nigerian urban areas, the inflation rate is higher than in rural communities. At the end of the first quarter of 2022, the urban rate was around 16 percent, while in rural zones it was 15.4 percent. Also in March 2022, the Consumer Price Index in Nigeria was 431.8. Compared to March 2021, CPI increased by some 16 percent. This means that inflation has been constantly increasing in the last months and the purchasing power of consumers in the national currency (Naira) decreased. The trend of the CPI of food shows a particularly high growth rate, at 503.6 in March 2022, increasing by around 17 percent compared to March 2021.
The prices of food in Nigeria are experiencing a constant increase, in particular for tomato and groundnut oil. The price of a kilogram of tomato grew by over 55 percent compared to the previous year, while the price of a bottle of groundnut oil rose by around 46 percent. Other food products that recorded the highest growth in prices are beans, potatoes, and vegetable oil. Together with food, further items that have experienced a price increase are non-alcoholic beverages, clothing and footwear, as well as housing water, electricity, gas and other fuel.
Regarding fuel and gas prices, consumers in Nigeria paid 654.46 Naira per liter for diesel in April 2022 on average, roughly 1.6 U.S. dollars, with the South-West registering the highest prices. In the same month, the average price of gasoline was 172.61 Naira per liter (0.4 U.S. dollars). Over the past year, the lowest price was recorded in June 2020, when it reached 161.17 Naira. Due to the coronavirus (COVID-19) pandemic and the related decrease in national and international movements, the demand for oil decreased and prices dropped. However, steady price increases have emerged since January 2022. Eventually, the price of cooking gas (liquefied petroleum) in Nigeria was 3,800 Naira (9.1 U.S. dollars) per 5 kilograms as of April 2022. Large differences in refilling prices are also observable by state.
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