Rising inflation pushes 14 million Nigerians into poverty as government expands cash assistance

Rising inflation has pushed 14 million Nigerians into poverty, with nearly half the population below the poverty line, per the World Bank’s latest report.

As inflation surges across Nigeria, an estimated 14 million people have fallen into poverty in 2024 due to stagnating labour incomes.

According to the World Bank’s recent Macro Poverty Outlook report, 47 per cent of Nigeria’s population now lives below the international poverty line of $2.15 per day, with inflation and economic challenges stifling growth and pushing millions into hardship.

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The report highlights the widening poverty gap as labour incomes fail to keep up with inflationary pressures, underscoring the need for structural economic reforms.

Projections indicate that poverty levels could rise further, potentially reaching 52 per cent by 2026 if immediate measures are not taken.

In response, the Nigerian government has initiated temporary cash assistance for 15 million low-income households, aiming to alleviate some of the financial pressures on the country’s most vulnerable populations.

Under this programme, each household will receive N75,000, distributed in three instalments. The initiative is expected to reach around 67 million individuals, bringing short-term relief to those hit hardest by inflation and economic instability.

The report also noted that Nigeria’s Central Bank raised the monetary policy rate by 850 basis points from February to September 2024, alongside an increase in the cash reserve ratio.

These measures were aimed at curbing inflation, but household purchasing power continues to be eroded, particularly as food prices remain high.

The World Bank emphasised that long-term solutions are crucial to combat poverty effectively. It recommended reforms focused on protecting the poorest from inflation and creating productive employment opportunities.

Sustainable economic growth that matches Nigeria’s rapid population increase remains a key challenge, with the bank calling for a “comprehensive approach to bolster resilience and create sustainable pathways out of poverty.”

The Nigerian government has ramped up its social investment programme, which the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, recently announced now reaches 25 million vulnerable individuals from five million households.

The programme includes direct cash transfers to those on the social register, verified through biometric identification and distributed via bank accounts or mobile wallets.

Addressing reporters after the 145th National Economic Council meeting, Edun confirmed that the first two payments have already reached beneficiaries.

The government’s efforts reflect an urgent response to the worsening poverty levels, but experts highlight the need for sustained economic reform to enable long-term stability and growth in the face of ongoing inflation and a high poverty rate.