Nigeria’s President Muhammdu Buhari, on Saturday, claimed that his administration lifted  10.5 million Nigerians out of poverty in the last two years, arguing that various interventionist programmes by his administration had put the economy on the path of sustainable economic growth.

Buhari, who made this claim during his June 12 Democracy day address, said interventions made by the Central Bank of Nigeria (CBN), targeted at agricultural, services, infrastructure, power and health care sectors of the economy had seen appreciable growth in the economy.

According to Buhari, “In the last two years, we have lifted 10.5 million people out of poverty -farmers, small-scale traders, artisans, market women and the like.

“I am very convinced that this 100 million target can be met and this informed the development of a National Poverty Reduction Programme Pwith growth strategy. The specific detail of this accelerated strategy will be unveiled shortly, ”Buhari stated.

However, available data have shown that many Nigerians still live in extreme poverty in the last two years( 2018 or 2019 to 2020 or 2021), despite interventionist efforts by the government.

About 87 million Nigerians lived in extreme poverty in 2017, said World Poverty Clock.

According to the World Poverty Clock, the number rose in 2019. Nigeria had a total population of 205.32 million in 2019, with 105.097 million living in extreme poverty, representing 51 per cent of the population. This means the number of extremely poor people rose from 87 million to 105 million in two years.

An individual is classified as living in extreme poverty if the person earns below $1.90 per day.

The National Bureau of Statistics (NBS) said in a 2020 report, covering September 2018 to October 2019, that 40 per cent of people in the country lived below poverty line of N137,430 ($381.75) a year, representing 82.9 million people.

The NBS did not say that the number of poor Nigerians fell in 2020. It rather said that 67 per cent of household incomes fell by August 2020, as against 2019. This meant more people thrown into poverty.

A 2021 report by Alexander Irwin, Jonathan Lain and Tara Vishwanath, published on World Bank blog, noted that more Nigerians had been pushed into poverty by COVID-19 – even with all the interventions by government.

Contrary to Buhari’s claim on economic growth path, growth in the last five years has been less than two percent – less than 2 6 per cent of population growth- meaning more poverty for Africa’s most populous nation.

Recession has occured in the last two years with the economy exiting in the last quarter of 2020. However, growth was just 0.11 per cent in the fourth quarter of 2020 and 0.5 per cent in the first quarter of 2021. The situation means that more people are not out of poverty due to lack of growth in the economy.

An economist and former director-general of the Abuja Chamber of Commerce and Industry (ACCI)  Chijioke Ekechukwu told The ICIR that the president might have lifted a number of people out of poverty, but probably not up to 10.5 million people.

He said the Anchor Borrowers Programme impacted many rice growers, millers and traders.

However,  data do not justify Buhari’s claim.

From 2018 to 2020, unemployment has risen from 18.8 per cent to 27.1 per cent and then to 33 per cent, according to the NBS. More joblessness means more people in the extreme poverty circle.

The exchange rate has risen from N307/$ in 2019 to N410/$ in 2021.Weakening local currency makes products expensive and reduces incomes. It consequently increases the number of poor people. The exchange rate has weakened 34 per cent in two years, demonstrating that more Nigerians have jumped into extreme poverty.

Nigeria may be the largest economy of the African content, but the average Nigerian is more miserable than many in other countries. The misery index is calculated by adding a country’s inflation and unemployment rates, among others. Nigeria’s inflation rate is over 18 per cent and the country’s joblessness is rising, fuelling misery among the population.

Analysts warn that a holistic approach to tackling poverty should have a national policy appeal and feed into the national budget, the government’s planning and other policies of the government.

“If we don’t have a national policy programme upon which the government feeds into its national budget and other programmes, we may not get it right. The programmes would be knee-Jerk,which do not take us to where we want in terms of growing the economy. For instance, what is the national policy programme on agriculture, poverty reduction, unemployment, and others? This programme should ordinarily feed into the national budget to drive economic growth.”An associate consultant at the British Department of International Development (DFID) and a development analyst Celestine Okeke told The ICIR.

NIGERIA’S Finance Minister Zainab Ahmed has said that naira is responding to market forces against the popular perception that it has been devalued.

The minister, who spoke on President Buhari’s six years in office in a monitored television broadcast, noted that weak response of Nigeria’s naira to the United State’s dollar was largely attributed to volatility in the oil price which contributed largely to Nigeria’s reserves

“Let me not use the word ‘devaluation.’ Naira is responding to market forces of demand and supply. We have oil and gas, unfortunately, still the major source of foreign exchange,” she said, noting however that efforts were being made to expand other sources of revenue to strengthen the naira.

 “Right now, we are working at developing alternatives to earning foreign exchange from the mineral sector and supporting businesses that are exporting finished products which means more foreign exchange coming into the country.”

Oil contributes less than 15 per cent to the Gross Domestic Product (GDP), but is responsible for at least 70-85 per cent of revenue and 80-90 per cent of foreign exchange in Africa’s biggest oil producer.

Naira has officially weakened from N306 in 2020 to over N400 in 2021 after oil price volatilities in the COVID-19 market. Dollar exchanged at N592 at the parallel market on June 11.

As a monocultural market, the Nigerian economy has largely been a price taker in the global foreign exchange market due to its inability to earn big from export of finished products.

Zainab stressed that the volatility characterising the oil price at the international market affected Nigeria’s foreign exchange, and  the value of the currency.

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“This development affects the level of our reserves and affects other key aspects of the economy.”

She further said that the Federal Ministry of Finance and the Central Bank of Nigeria had made a commitment to converge towards a single exchange rate.

“The governor of the central bank and I have made a commitment while we processed the IMF loan of $3.4 billion that we are going to converge towards a single exchange rate. If you remember in the year 2020, we did the initial exchange 2020 budget at 305naira to the US dollar.

“When Covid-19 happened and we are processing all these finances, an adjustment was made for the official exchange rate to be N360. The further requirement was that the monetisation for the foreign exchange, even for the government, is done at the market rate, not the black market rate – NAFEX rate. That is what is happening now. So, when the government earns its money whether from FAAC or from any other sources, it is monetised at the NAFEX rate.”

She explained that the country had now converged to a single exchange rate which would help put the economy on a growth path, gaining investor confidence.

“In a way, we could say we have converged because we are now doing everything at the NAFEX rate. The other rate is the unofficial rate and unorthodox market. That market will improve when the inflow in foreign exchange improves.”

The government is eyeing to converge at the NAFEX rate – the poll rate based on the contributions of 10 banks- to create stability in the market. But this has been difficult due to factors ranging from demand to supply inefficiencies.

Analysts do not agree with the minister as even the CBN Governor Godwin Emefiele, in May 2021, replaced an earlier N379/$ rate with N410/$, admitting that it was no longer feasible and  the bank was running a managed-float system.

Investopedia defines devaluation as a “deliberate downward adjustment of the value of a country’s money relative to another currency, group of currencies, or currency standard.”  The  CBN has deliberately moved official FX rates from N305/$ to N315/$, and to N379/$ to 410/$ in less than two years. This means devaluation.

The minister attributed rising inflation to the exchange rate, with other factors such as transport costs linked to increasing PMS price and an inadequate number of mass transit vehicles and trucks for food and other forms of transportation, noting the government was working on a lasting solution to the concerns.