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Food and fuel prices soar and negotiations continue over new social welfare payments scheme
The big story in Abuja this week is President Bola Tinubu's cabinet – who's in and who's out. The deadline for Tinubu to unveil the list is 29 July but many expect the list to emerge today. It won't be the full cabinet with assigned posts but a list of nominated ministers, at least one from each of the 36 states.
With some educated guesses it would be possible to work out which nominees are likely to get which ministries. For example: Wale Edun for finance, Olu Verheijen for energy and Kayode Fayemi for foreign affairs.
If Tinubu waits much later than this week it means the National Assembly may not start vetting the appointees until after its recess. That would mean it could be October or November before Tinubu's cabinet is working.
Plenty of reasons are circulating in Abuja for the two-month delay in announcing the cabinet: some of the proposed names would not pass vetting on anti-corruption grounds (a notion that has prompted many barbed comments about Tinubu's own career) or that the ruling All Progressives' Congress is splitting at the seams, forcing Tinubu to placate some its dissident outposts.
Tinubu has already launched so many important policies, guided only by his handpicked and unvetted special advisors, cabinet government doesn't look like a priority for him (AC Vol 64 No 15, Naira politics rules – but the pace picks up).
That mode, similar to the Muhammadu Buhari cabal style of decision-making, could come unstuck. It either puts all the decision-making on to the president or allows non-accountable advisors to take executive decisions.
Some cracks are opening. After applause from bankers and diplomats for ending the fuel subsidy and floating the naira, the much forecasted inflationary spiral has started. Prices are rising faster than at any time for nearly two decades.
Praising the subsidy move, the World Bank estimates that Nigeria's GDP growth could double to over 4% by next year in the wake of the reforms. But first comes the pain, at least for most Nigerians (AC Vol 64 No 12, Tinubu tries shock therapy on sluggish economy).
Fuel prices tripled after subsidies were ended. And they have gone up by a further 15% this week to N617 (US$0.78) a litre. This will drive up food prices further as transport costs soar and it could trigger food shortages in some areas.
On 18 July, President Tinubu announced he would be reviewing the plan to pay N8,000 a month to 12 million households which has been widely criticised as grossly inadequate. This means that his request to the National Assembly for an additional N500 billion for these social grants will have to be expanded (AC Vol 64 No 13, Tinubu's team looks for shock absorbers).
Tinubu announced a national emergency on food security last week allowing the government to take exceptional measures to boost food supplies. These include permits to clear forest for farmland and direct funding from the central bank to farmers as well as setting up a national commodity board and a strategic grain reserve to manage demand and supply.
Details are yet to emerge about how these new institutions will operate and who will run them, specifically whether they will be under the aegis of the agriculture ministry.
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