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Business

Minimum Wage: How Nigeria compares with its global peers 

Nigeria’s minimum wage lags behind its global peers, thanks to economic factors related to earning.

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Minimum Wage: How Nigeria compares with its global peers

“State Governments not paying are breaching the law of the land. This minimum wage is different from CVA (Collective Bargaining agreement); this is a national decree that says what you will pay to the lowest-paid employee in your establishment.” 

Those were the words of Labour Minister, Chris Ngige on Sunday, as he warned state governments and private firms that a failure to meet the minimum wage compliance would be met with legal consequences. 

Since Nigeria adopted the minimum wage of N30,000 ($73.2 at NAFEX rate of $1=N410), compliance has been difficult and many state governments have admitted to being unable to pay the set wage.

The Federal Government has implemented policies to improve the minimum wage budget including exempting minimum wage earners from paying personal income tax, in order to stimulate the economy and improve the standard of living of this group of workers.

READ: Naira falls at NAFEX window despite 394% increase in dollar supply

The FG also recently announced that consequential adjustment of the new pension payment would commence from the May 2021 payroll, with the arrears taking effect from April 2019, in a bid to adjust pension benefits occasioned by the 2019 new minimum wage. 

Nigeria’s minimum wage lags behind its global peers, thanks to economic factors related to earning. The MINT nations, which Nigeria is part of, is made up of developing economies with proper formal diversified economic sectors, which have made minimum wage implementation less of a hassle as wages have grown significantly over the last 20 years compared to Nigeria. 

MINT nations 

The name was coined in 2013 by economist Jim O’Neill, the same person who popularized the term “BRICs.”

“Mexico, Indonesia, Nigeria and Turkey all have very favourable demographics for at least the next 20 years, and their economic prospects are interesting,” O’ Neill said 

The countries selected on the MINT list were measured on multiple factors including, economic growth, age demographics, geography, internet adoption, and many more. 

READ: Has the Naira been devalued?

The minimum wage in MINT nations 

Mexico

With a GDP per capita of $9,946 in 2019, the Mexican National Minimum Wage Commission recently announced its decision to increase the general minimum daily wage to 141.70 Mexican pesos (approximately US$7.10) in 2021, which at a rate of 30 days a month, is 2.7 times larger than Nigeria’s minimum wage using official CBN rates.

Indonesia

With a GDP per capita of $4,130 in 2019, Indonesia’s per capita income has grown over 5 times in the past 20 years. Of Indonesia’s 34 provinces, only five decided to increase the minimum wage for 2021, with the Jakarta region having a minimum wage of $312 a month, which is nearly 4 times Nigeria’s minimum wage.

Jaiz bank

READ: Rising Wages and Low Productivity: The Need for a Justified Minimum Wage Agreement

Turkey

A founding member of the OECD and NATO, and also a member of the EU-Turkey Customs Union, Turkey had a GDP per capita of $9126 in 2019, growing nearly 3 times in 20 years. The Turkish Government raised its minimum wage by 21.56% as of January 1, 2021, to $377 a month for single people, which is nearly 5 times Nigeria’s minimum monthly wage. 

Differences between MINT and Nigerian wages 

The MINT nations were all included in the list for their growth capacity for the next 20 years; however, Nigeria seems to have regressed with gains it made when the list was made. While other members of the club have grown earnings by 3 to 5 times over in the past 20 years, Nigeria’s GDP per capita is the same level it was 40 years ago. 

Tim Callen, Assistant Director in the IMF’s External Relations Department, said in a 2020 report that “an increase in real GDP is interpreted as a sign that the economy is doing well. When real GDP is growing strongly, employment is likely to be increasing as companies hire more workers for their factories and people have more money in their pockets.” 

However, Nigeria may not catch up to its MINT buddies anytime soon, as the IMF forecasts that Nigeria’s real GDP growth in 2021 is expected to turn positive at 1.5%, while real GDP is expected to recover to its pre-pandemic level only in 2022. 

“An appropriately valued exchange rate and a clear exchange rate policy would also help instil confidence and private sector-led recovery. Policy clarity is also important to attract larger capital inflows, including foreign direct investments, which have dropped significantly in recent years and successful diversification,” IMF urged the FG.

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Business

FG declares Wednesday, Thursday public holidays

The Federal Government has declared Wednesday 12th and Thursday 13th May as public holidays to mark the 2021 Eid-ul-Fitr celebration.

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The Federal Government has declared Wednesday 12th and Thursday 13th May as public holidays to mark the 2021 Eid-ul-Fitr celebration.

This was disclosed in a social media statement issued by Dr. Shuaib Belgore, the Permanent Secretary of the Ministry of Interior, on behalf of the Minister, Ogbeni Rauf Aregbesola on Monday.

What the Minister said

The Minister of Interior, Ogbeni Rauf Aregbesola, while making the declaration on behalf of the FG today in Abuja, congratulated the Muslim faithful on this occasion and called on all Nigerians, at home and abroad to use the period of this year’s Eidul-Fitr celebration to pray for peace, stability and economic transformation in the land.

Aregbesola who believes that development cannot thrive in a rancorous atmosphere, urged all Nigerians to be law-abiding and embrace the spirit of love, self-discipline, kindness and tolerance, as taught by the Holy Prophet Mohammed (Peace Be Upon Him). He also called on all security agencies in the country to be more courageous and patriotic to surmount the ongoing battle against resurging insecurity and activities of criminal elements in Nigeria.

He assured that the resolve of the President Muhammadu Buhari-led administration to end the scourge of crime and criminality in the country and restore peace to every nook and cranny of Nigeria was sacrosanct.

“This administration will not be deterred in its efforts, until every Nigerian and resident of the country, is free to move around without fear of any threat to his/her life and property. We are therefore putting necessary measures and strategies in place to strengthen the stability of the country as well as ensuring economic prosperity of our dear nation,” he emphasised.

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Business

Insecurity: Police to investigate threats by IPOB, Oodua Republic agitators in Lagos

The Lagos State Police Commissioner has revealed that threats by IPOB and Oodua Republic have come under its intelligence radar.

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The Nigerian Police says it will investigate threats made by separatist groups including the Indigenous People of Biafra (IPOB) and agitators of Oodua Republic to attack soft targets in Lagos.

This was disclosed by Hakeem Odumosu, Commissioner of Police in Lagos State in a meeting to discuss insecurity in the state at Alausa in Ikeja, on Monday, according to a Vanguard report.

What the Police is saying about alleged IPOB and Oodua Republic threats in Lagos

“Our intelligence report revealed that, most miscreants now: Use abandoned buildings as hideouts and in most cases, initiation camp, use uncompleted buildings, dwelling house and hotels to hibernate before and after the commission of a crime,” the Police Chief said.

Furthermore, the threat of IPOB to attack soft targets in Lagos is equally being put on the radar of the command intelligence gathering and other security services in the state. Strategies are being put in place to neutralize their activities.

Similarly, the command has taken notice of agitators for the Oodua Republic by some Yoruba separatist groups and the threats to disrupt law and order in the state. 24 of these groups have been identified and are being closely monitored.

The command is using this medium to solicit for the support of all and sundry to be vigilant at all times and report any suspicious person or movement to security agencies. Let us adopt the slogan of “when you see something, say something,” he added.

What you should know

Today, the Lagos State Police Command said in a statement that: “Increase in robbery incidents were as a result of people migrating from troubled states down to Lagos. The government and relevant security agencies including RRS are doing their best in protecting members of the public.”

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