A man protests food inflation in South Africa’s largest township, highlighting economic challenges.
On the wealthy peninsula of Victoria Island in Lagos, Nigeria’s commercial capital, no one knows how much their grocery shopping costs. Prices are changing so quickly that shopkeepers have given up on tags altogether. At the till, one might be shocked to discover that a tomato is now 8 cents. Last year that could get you four, enough to balance out the hot spice in a pot of jollof rice. That staple dish is made dearer still by the soaring prices of onions and rice, forcing the poorest Nigerians to skip meals. Because Nigeria is dependent on imports, its weaker currency is pushing the annual inflation rate towards a three-decade high at almost 30%. The decline is also eating into the hard-currency profits of multinational businesses. For example, MTN, a South African telecommunications company whose biggest market is Nigeria, this month said its group profit could fall by 60-80% and that its Nigerian unit would make a loss because of the naira’s collapse. The currency volatility is eroding confidence, sparking protests from unions and deterring much-needed investment.