The relentless devaluation of the Nigerian Naira, reaching an alarming peak at N2,010 per CFA1000, has sent shockwaves through the economy, severely impacting cross-border trade and leading to unprecedented spikes in commodity prices. This challenging scenario has hit traders, especially those dealing in rice and frozen poultry products at the Seme-Krake border in Lagos, particularly hard. The cost of a 50kg bag of rice has skyrocketed to a staggering N35,000, while a carton of frozen poultry products now commands a price tag of N28,000. Traders like John Ebube from Lagos lament the growing financial hardships as the Naira’s value continues its downward spiral.
The depreciation of Nigeria’s currency has inadvertently turned petrol smuggling into a profitable business. Since the removal of petrol subsidies in May, petrol prices have surged to unprecedented levels, now exceeding CFA 1000 (approximately N2,010) per liter. This dire situation is exacerbated by Nigerians exchanging CFA Francs for dollars in neighboring Niger.
The scarcity of CFA Francs, further compounded by a military coup and suspicions of hoarding by government officials, has led to the increased use of the Naira in transactions in markets in provinces bordering Nigerian states such as Borno, Yobe, Kano, Katsina, and Sokoto. Aminu Abdulkadir from Diffa, a region in Niger, has confirmed this shifting trend.
The depreciating Naira has also triggered significant disruptions in the West African sub-region. Recent exchange rates peaking at N2,010 per CFA1000 have prompted a mass exodus of traders from cross-border businesses due to diminishing profit margins. Adding to the woes, the CFA franc has recently appreciated against the Naira. Previously exchanging at 1100 CFA francs to N1,200, it now hovers between N1600 to N1700. This, coupled with the substantial price hikes for essential commodities like rice and frozen poultry products, has eroded the profitability of cross-border trade. Consequently, Nigerian cross-border traders are grappling with increasingly unviable ventures.
As the Naira’s value continues to be a matter of concern, government officials, policymakers, and traders are left grappling with the challenges brought on by this economic conundrum. The hope for stability and economic recovery remains a priority, while the citizens and traders continue to bear the brunt of these ongoing fluctuations.