The Effect Of The Declining Naira Value On Daily Life In Nigeria

Currency exchange rate refers to the value of a nations currency in relation to that of another nation, that is, what a nation's currency is valued at in another country. This is a very important aspect of business that affects importation, exportation, international business and thus, every facet of human life in a nation. All nations require international trade to function as no single nation can produce all the goods and services it requires and thus, a country's currency value reflects where a nation stands in the international market. Nigeria's primary source of international revenue has been through the exportation of crude oil though she has other natural resources such as tin, bitumen etc. In the last two years, the Nigerian Naira has experienced a progressive decline in value from around N270 to $1 in 2013 to over N450 in 2016. This was caused largely due to the crash in the price of crude oil in the international market which reduced revenue from oil exports which is Nigeria's largest source of income. Also contributing to this is the increase in the supply of oil in the international market from fracking and the discovery of crude oil in new countries. As a result of this, the nation has been experiencing a high rate of inflation and this has influenced everything from Rice to travel costs. The aspects of lifestyle affected are those that depend heavily on importation. As mentioned earlier, the cost of Rice for example has skyrocketed as most of the Rice consumed in Nigeria is imported. This crisis has led to numerous banks putting restrictions on withdrawals and payments being made abroad. The country has also reported a decline in foreign travels and lowered demand for the black market. I intend to study the effect this declining value have on daily life, using Bowen University, Iwo, Osun State as a case study. The study seeks to highlight the difficulties experienced by the students of the institution in keeping up with the demands of daily life with the rising cost of living with the aim of conjuring solutions to the challenges being faced. I will also take into consideration the business owners in the institution and how the economic downturn has affected their business and what measure they have been forced to take to stay afloat, from increasing the prices of goods to reducing production. The University itself has been affected by the change in fortune, recently being forced to increase fees for new and returning students and during the first semester of the last academic year, was forced to vacate early due to the rising costs of fuel. It continues... This post was written by Tokoni Uti Bowen University, Iwo