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Macro-Economic News

Transport fare watch: Motorcycle “Okada” commuters paid less in January 2021

Commuters on motorcycle per drop (Okada) paid less in January 2021 than they did in December 2020.

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Transport fare for motorcycle "Okada" more than doubled in 2020, Lagos State bans Gokada, ORide, MaxNG, others from 15 local governments 

The average fare paid by commuters for journey by motorcycle per drop decreased by 11.60% month-on-month and increased by 95.22% year-on-year to N259.33 in January 2021 from N293.36 in December 2020, according to the National Bureau of Statistics (NBS) report for the month of January 2021.

According to the report, commuters in  Taraba (N400.80), Yobe (N400.15) and Rivers (N400.00) paid the highest journey fare by motorcycle per drop while commuters in Adamawa (N84.22), Katsina (N134.90) and Kebbi (N152.05) paid the lowest journey fare by motorcycle per drop.

READ: Transport Fare: Motorcycle “Okada” commuters paid more in November

Other key highlights

  • The average fare paid by commuters for bus journey intercity decreased by 0.25% month-on-month and increased by 39.55% year-on-year to N2,346.41 in January 2021 from N2,352.19 in December 2020.
  • Commuters in Abuja FCT (N4,482.24), Lagos (N3,300.23) and Sokoto (N3,300.00) paid the highest bus journey fare intercity while commuters in Bayelsa (N1,600.45), Bauchi (N1,640.20) and Enugu (N1,687.45) paid the lowest bus journey fare within city.
  • The average fare paid by commuters for bus journey within the city decreased by 0.66% month-on-month and increased by 74.75% year-on-year to N352.15 in January 2021 from N354.49 in December 2020.
  • Commuters in Zamfara (N600.00), Bauchi (N522.75) and Ekiti (N458.77) paid the highest bus journey fare within city while commuters in Oyo (N189.46), Abia (N205.22) and Borno (N240.79) paid the lowest bus journey fare within city.
  • The average fare paid by air passengers for specified routes single journey increased by 0.02% month-on-month and by 18.27% year-on-year to N36,463.65 in January 2021 from N36,454.59 in December 2020.
  • Passengers in Anambra (N38,600.00), Cross River/Jigawa/Lagos (N38,500.00), Bauchi (N38,400.00) paid the highest airfare while States with lowest airfare were Akwa Ibom (N32,450.00), Sokoto (N33,700.00), and Gombe (N35,000.00).
  • The average fare paid by passengers for water way passenger transport increased by 3.68% month-on-month and by 38.58% year-on-year to N786.19 in January 2021 from N758.27 in December 2020.
  • Passengers in Rivers (N2,280.00), Delta (N2,250.45) and Bayelsa (N2,200.10) paid the highest fare by water while states with lowest fare by waterway passenger transport were Borno (N245.10), Gombe (N290.77) and Kebbi (N340.00).

READ: Transport fare for motorcycle “Okada” more than doubled in 2020

Why this matters

Transportation cost takes a huge portion of budget for most lower/middle-class Nigerians and as well takes not less than 20% of their take-home pay packages.

The drop in fares paid by the commuters on motorcycle per drop (Okada) is a welcome development.

Transport by motorcycle (Okada) has been popularly adopted in most cities by businessmen, government workers, and students to overcome traffic congestion, and for the advantage that it can navigate roads that are inaccessible to automobiles and buses, particularly in villages and urban slums.

Hotflex

Johnson is a risk management professional and banker with unbridled passion for research and writing. He graduated top of the class with B.sc Statistics from the University of Nigeria and an MBA degree with specialization in Finance from Ambrose Alli University Ekpoma, with fellowships from the Association of Enterprise Risk management Professionals(FERP) and Institute of Credit and Collections management of Nigeria (FICCM). He is currently pursuing his PhD in Risk management in one of the top-rated universities in the UK.

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    Macro-Economic News

    Motorcycle “Okada” fare in Nigeria surges by 102.5% in March 2021

    Specifically, the average fare increased from N134.07 recorded in March 2020 to N271.44 in March 2021.

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    Transport fare for motorcycle "Okada" more than doubled in 2020, Lagos State bans Gokada, ORide, MaxNG, others from 15 local governments 

    The cost of commuting in Nigeria by motorcycle popularly known as “okada” surged by 102.46% year-on-year in March 2021 to stand at N271.44. This is according to the National Bureau of Statistics (NBS) report on transport fare watch.

    According to the report the average fare paid by commuters for journey by motorcycle, increased by 1.76% month-on-month and 102.46% year-on-year. Specifically, it increased from N134.07 recorded in March 2020 to N271.44 in March 2021.

    READ: How air passengers can save more as Nigerian fares rise by 100% in 30 days

    • The increase could be partly attributed to the increase in the price of fuel across the country, the ban on okada in some areas, and the effect of the covid-19 pandemic, which affected most aspects of the country’s economy.
    • States with the highest journey fare by motorcycle per drop were Rivers (N420.35), Taraba (N420.15), and Yobe (N420.1).
    • States with the lowest journey fare by motorcycle per drop were Adamawa (N90.43), Katsina (N147.64), and Niger State (N159.2).

    READ: Cost of building materials rise by over 60% in one year

    Transport fare by Air

    The average fare paid by air passengers for specified routes single journey increased by 18.71% year-on-year to N36,495.41 in March.

    • On a month-on-month basis, the average fare paid by air passengers increased by 18.71% from N36,458.11 in February 2021 to N36,495.41 in the month under review.
    • States with the highest airfare were Anambra/Lagos (N38,600.00), Delta/Jigawa (N38,500.00), Bauchi (N38,450.00).
    • Meanwhile, states with the lowest airfare were Akwa-Ibom (N32,700.00), Sokoto (N33,200.00), and Katsina (N35,150.00).

    READ: Cement prices surge in South East as scarcity, price hike hit North East

    Transport fare by Bus

    The average fare paid by commuters for bus journey within the city increased by 4.42% month-on-month and by 82.50% year-on-year to N377.27 in March 2021 from N361.31 in February 2021.

    • Also, the average fare paid by commuters for bus journey intercity increased by 1.62% month-on-month and by 42.58% year-on-year to N2,411.29 in March 2021 from N2,372.87 in February 2021.
    • States with the highest bus journey fare within the city were Zamfara (N618.23), Bauchi (N597.14), and Ekiti (N500.15) while States with the lowest bus journey fare within the city were Oyo (N197.55), Abia (N209.87), and Borno (N258.14).
    • States with the highest bus journey fare intercity were Abuja (N4,576.28), Lagos (N3,425.18), and Sokoto State (N3,380.20).
    • While States with the lowest bus journey fare within the city were Bayelsa (N1,700.19), Enugu (N1,720.45), and Bauchi State (N1,725.35).

    READ: Bus fare in Nigeria surges by 78% YoY in February 2021

    Hotflex

    Transport fare by Water Way

    • The average fare paid by passengers for waterway passenger transport increased by 1.81% month-on-month and by 43.52% year-on-year to N808.38 in March 2021 from N794.02 in February 2021.
    • States with the highest fare by waterway passenger transport were Bayelsa (N2,300.80), Delta (N2,300.60), and Rivers (N2,285.67) while states with the lowest fare by water way passenger transport were Borno (N250.30), Gombe (N320.15), and Abuja (N350.79).

    What this means

    The transportation sector constitutes one of the major features of the economic development of any country. However, Nigerians continue to pay more for transporting themselves and conveying goods from one place to another.

    SSKOHN

    The increase in transport fare is basically due to higher fuel prices, persistent decline in the exchange rate, and the general increase in the prices of goods and services in the country. Core inflation is currently at 12.67%, the highest in almost four years.

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    Economy & Politics

    Nigerian states generate N1.31 trillion IGR in 2020 as Lagos dwarfs others

    The 36 states and the Federal Capital, generated a sum of N1.31 trillion as Internally generated revenue (IGR) in 2020

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    FAAC, IGR, Fiscal federalism in Nigeria, NEC Inauguration, Bailout Fund: FG begins deduction of N614 billion from states’ allocation in 2 weeks , Ekiti, Enugu, Bayelsa, 12 others attract no investment in 1H , States’ debt stock, Fiscal federalism

    The 36 states and the Federal Capital Territory generated a sum of N1.31 trillion as Internally generated revenue (IGR) in 2020. This was contained in the state IGR report, which was recently released by the National Bureau of Statistics (NBS).

    According to the report, the states’ IGR declined by 1.93% from N1.33 trillion, recorded in the previous year to N1.31 trillion in 2020. It however increased by 11.7% compared to N1.69 trillion recorded in 2018.

    The decline may be due to the effects of the covid-19 pandemic on the various states of the federation, as they were forced to implement lockdown protocols to curb the spread of the disease in the country.

    Highlights

    • States generated N1.09 trillion from taxes in the year 2020, accounting for 83.3% of the total IGR received in the year.
    • Tax revenue also declined, when compared to N1.11 trillion collected in the previous year. This represents a 2.25% decline year-on-year.
    • Lagos State recorded the highest Internally Generated Revenue of N418.99 billion, accounting for 32.1% of the total and closely followed by Rivers State with N117.19 billion.
    • Others with the highest IGR in 2020 include Abuja (N92.06 billion), Delta (N59.73 billion), and Kaduna (N50.75 billion).
    • Kebbi State recorded the highest year-on-year growth of 87.02%, closely followed by Ebonyi at 87.3%. Oyo State grew its IGR by 42.23%, Borno (41.63%), while Katsina grew by 34.16%.
    • On the flip side, Benue State recorded the highest year-on-year decline of 41.38%, followed by Sokoto State, which dipped by 37.93%, Kwara (36.03%), Jigawa (32.95%), and Ogun State (N28.44%).

    A cursory look at the data shows that the States recorded the highest quarterly IGR in the first quarter of the year, before the covid-induced lockdown in March 2020. It however dipped significantly by 25.53% to stand at N269.88 billion in Q2 2020.

    States generated a sum of N338.57 billion in Q3 2020 and then recorded a marginal decline in Q4 2020 to stand at N335.25 billion.

    Lagos dwarfed others

    Lagos State recorded the highest internally generated revenue in 2020, having made N418.99 billion, accounting for 32.08% of the total states’ IGR recorded in the period under review.

    • It is no surprise that Lagos State makes this much revenue as it is regarded as the commercial hub of Nigeria.
    • According to the data from NBS, Rivers State is a distant second on the list with N117.19 billion as IGR, representing 8.97% of the total, while the Federal Capital Territory, Abuja followed closely with N92.06 billion, representing 7.05% of the total recorded in the year.
    • Others on the list include Delta State (N59.73 billion), Kaduna State (N50.77 billion), Ogun (N50.75 billion), and Oyo State with N38.04 billion.

    Kebbi, Ebonyi boosted revenue by over 80%

    Kebbi State and Ebonyi State grew their internally generated revenue by over 80%, with Kebbi recording 87.02% growth in IGR to stand top on the list of states with the highest growth rate; followed closely by Ebonyi State with 82.3% growth in IGR to stand at N13.59 billion.

    • Oyo State grew its IGR by 42.23%, Borno (41.63%), Katsina (34.16%), and Gombe (25.5%).
    • Meanwhile, 18 out of the 37 states of the federation recorded a decline in IGR in 2020, a list led by Benue State, having dipped its annual IGR by 41.38%, followed by Sokoto with 37.93%, Kwara (36.03%), Jigawa (32.95%), and Ogun State with a decline of 25.44%.

    What this means

    • The decline in states’ internal revenue was caused by the pandemic which struck earlier in 2020, disrupting economic activities in the country.
    • Nigeria recorded a recession in the third quarter of 2020, after a consecutive economic contraction, recorded in Q2 and Q3 2020.
    • It, however, recovered from the recession in the fourth quarter. It is therefore hoped that as economic activities resume fully in the country, the states will be able to boost their revenue in the short-to-medium term.

    Hotflex
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