Nigerians Feel Pinch of Austerity
Food production is rising, but belt-tightening measures cause severe drop in per capita income. MIDDLE CLASS
AMOS ADELU, a Nigerian college lecturer, has what a friend calls a ``miracle'' car. All four of its inner-door panels have fallen off; wires hang loosely from beneath the dashboard; and the family has to push-start it every morning. It's a miracle that it runs at all. Lawrence Badru, a Nigerian accountant, used to be able to afford milk and fruit for his wife and three children. And he used to take trips to nearby African states.
Today the family eats mostly rice, beans, cassava, and bread, and in smaller quantities than before. He no longer makes trips outside Nigeria, staying instead in Lagos, where he drives a taxi and tries to make ends meet.
Africa's small but vital middle class, including people such as Mr. Adelu and Mr. Badru, is losing ground. As about half of Africa's nations pursue belt-tightening austerity measures in response to economic decline, it is the middle class that most change is felt.
Nigeria's austerity measures are having some positive results. Food production is rising at about 5 percent a year, as crop pricing reforms have boosted farmer incomes. And nonoil exports have been increasing since 1986, after Nigeria slashed the value of its currency to make its exports more attractive abroad.
But such measures also create a problem: Higher prices to farmers mean higher food prices for consumers. And lowering the value of currency to sell exports means reduced buying power for Nigerians. Imports become very expensive.
Africa's middle class normally plays a key role in the economy. But now both consumption and investment have been curbed by the reduction in middle-class purchasing power.
Adjustment to the new austerity measures is painful everywhere they are being tried in Africa. Here in Nigeria, a once-thriving middle class used to enjoy a lifestyle unmatched in most African countries.
As recently as 1981, when the economy was booming, because of the high world price of oil, which Nigeria exports, Nigerians gobbled up expensive imported cars, stereo sets, VCRs, jewelry, and clothes. The Lagos airport was jammed with Nigerians coming and going from Europe, the United States, and other parts of Africa on vacation or business trips. People threw lavish parties, bought expensive gifts for relatives in their home towns, and built comfortable homes. ``Our problem was how to spend our money,'' says Sam Uba, a veteran Nigerian journalist in Lagos.
Things have changed dramatically.
As revenues from oil fell, per capita income in Nigeria slid from about $1,100 in 1982 to less than $300 today. In 1986, the military government of Nigeria began carrying out austerity measures, supported by the World Bank, that have sent the prices of imports and food soaring.
Nigerian men and women are turning more to locally made cloth for traditional Nigerian outfits. Western skirts, shirts and slacks are becoming less common. And locally grown foods, such as cassava, known as the ``poor man's food'' just a few years ago, have become staples in many middle-class homes.
Some of the other effects of reforms on the middle class are seen in the example of Badru.
Trained in London, he was working as a consultant to various import firms in Lagos until a few years ago. Then Nigeria cut the value of its currency to make exports cheaper. The devaluation sent the price of imports soaring. Suddenly it took a lot more Nigerian money to buy anything from abroad. Many of Badru's import business clients closed shop as fewer Nigerians could afford imports.
Adelu was hit by the same reform. He would buy parts for his car - or even a better car - if the price of imported car parts and cars had not gone so high as a result of the devaluation. (Nigeria does not produce cars, but plans to do so.)
But he's fortunate. At least he has managed to keep his car running. A common sight in Nigeria today is the wheel-less car, sitting on blocks, sometimes with its hood open, awaiting parts.
Food is also less affordable. Nigeria has banned the import of wheat, wheat flour, rice, and barley, once widely consumed by Nigeria's middle class. Local production of these crops is increasing. But price inflation and current reductions in the availability of such foods because of the import bans, have pushed food prices up sharply.
People like Badru and Adelu - and the massive lower income class of Nigeria - are left trying to stretch their earnings to cover the costs of even basic foods.
Among low-income Nigerians, people are ``terribly, terribly, terribly hungry,'' says another Nigerian journalist. Monthly factory wages as low as $30 don't go far when prices are rising.
``The man in the street is much worse off than two years ago,'' says a Western diplomat here. ``Only a military government could have done it [imposed such tough economic reforms],'' the diplomat adds.
Tariq Husain, the World Bank's representative in Lagos, says, that because the government is a military one, it has been able to make quick decisions on carrying out the reforms. ``Civilian governments don't have that kind of leeway,'' he says.
The two governments in Africa pushing ahead the hardest with economic reforms are Nigeria and Ghana. Both are military regimes. Mr. Husain says that Nigeria is ``headed in the right direction.'' He commends Nigeria for having ``persisted'' with them, despite the fact that there are ``winners'' (exporters and food producers) and ``losers'' (importers and those on fixed wages).
The reforms have their defenders, in addition to the military leaders.
``We've been overpampered in this country,'' says Mr. Uba, speaking of the pre-reform years. Now, he says, Nigerians are learning to be more self-sufficient by ``sweating it out.''
But some Nigerians ask whether there has been too much sweat and not enough benefits.
Students across much of southern Nigeria rioted last May, protesting their living conditions and the austerity measures. More than 40 persons reportedly died in the riots when the military clamped down with force and temporarily closed Nigeria's universities.
Nigerian economist Lade Egbuwalo, a lecturer at Ondo State College of Education in Iekere-Ekiti, sums up his view of the effects of the reforms this way: ``We are weeping and smiling.''
Wealthy Nigerians with foreign bank accounts whose money has not been devalued are doing very well, he says. But most of the middle class and the poor are doing very badly. The reforms are ``widening the gap between the rich and the poor,'' he contends.