Who Suffers the Most When Inflation Continues to Rise? Naturally, the Poor

When a country’s inflation continues to rise, like Nigeria’s double-digit inflation which hit 21.09 percent in October – a 17-year high, it is people who cannot define inflation or unpack its economic drivers that suffer the most.

People like Temitope Adegoke, a food seller and mother of three. Her interpretation of her current hardship is that life is not fair to her and her children. The mother of 3, struggles to afford enough food for her family; Tunde, 18, Lekan, 11 and Bunmi, 6.

With stagnant earnings because of dwindling sales, Temitope is faced with ever-increasing costs of her raw materials, as her suppliers are themselves forced to demand more to stay afloat. 

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“Life doesn’t give everyone what they deserve; I can’t afford to give my children what they really need in terms of food. A bag of rice, for example, sold for N50,000 at one point. I don’t think that six months ago, and rice seller saw that or even fathomed if that could be possible,” Temitope said.

Temitope hopes conditions will improve for her and other small business owners, but she has resigned herself to hope. “There is nothing I can do,” she said.

Temitope’s story is the story of many households in Nigeria – for whom perseverance and adaptation mean quite simply, less food on the table. Food inflation has risen consistently and now stands at 23.72% as at October 2022.

Food inflation typically falls during harvest season, typically between April and July, and then from September to December. However this year, food inflation has defied the trend very likely compounded by the effect of flooding which has devastated farmers and wiped out harvests across multiple states and so, multiple food staples.

Food inflation rose to 23.72 in October from 23.34 percent in the previous month and increased by 1.66% on a month-on-month basis. The year-on-year increase was however 29.67% from 18.34% recorded in October 2021 to 23.72% recorded in October 2022.

The composite consumer price index (CPI) which measures the average change over time in the prices of goods and services, reflects the pinch that every Nigerian is feeling because the price for all commodities in October 2022 increased.

Commodities that have to do with food (imported food, food, and foods and non-alcoholic beverages) have the highest composite consumer price index increase while communication, recreation, and culture, restaurant, and hotels have the lowest composite CPI respectively.

With Nigeria already facing a high-risk level of catastrophic hunger level, the recent flooding which is the worst flooding in a decade Nigeria has ever experienced, has worsened food insecurity in the country.  

“A large part of this year’s harvest was lost to the worst floods in Nigerian history for more than a decade,” said Ikemesit Effiong, head of research at SBM Intelligence.

“The effect of those losses will begin to be felt as the Christmas holiday enters its high season. Nigeria will set a few more inflation records till at least the first half of 2023,” Effiong said.

The World Bank recently projected that Nigeria’s accelerating inflation will push an additional 7 million into poverty by the end of 2022. To put it simply, if you’re not yet like Tope and her family, the likelihood is that you may be by the end of 2022.

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