The Impact of Government Measures on Inflation and Nigerian Diaspora's Financial Constraints

Feranmi Olaseinde

Feranmi Olaseinde

Aug 31, 20233 min read

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The Impact of Government Measures on Inflation and Nigerian Diaspora's Financial Constraints

Introduction:

In recent news, the Nigerian government has expressed its intention to curb rising inflation through a reduction in the circulation of cash. Minister of Finance and Coordinating Minister for the Economy, Mr. Wale Edun, has highlighted the importance of controlling the growth of money supply to strike a balance between supporting economic growth and preventing excessive inflation. Additionally, an article sheds light on the financial constraints faced by Nigerians living in the UK, highlighting the burdensome taxation system and other expenses that significantly impact their take-home pay. This article aims to explore the common points between these two issues and provide actionable advice for both the government and Nigerians in the diaspora.

Connecting the Dots:

The government's plan to reduce the circulation of cash aligns with its objective to control inflation. By implementing measures such as adjusting interest rates, open market operations, and setting reserve requirements for banks, the government aims to strike a delicate balance between ensuring adequate money supply for economic growth while averting the erosion of currency value and economic instability.

Similarly, Nigerians in the UK face financial constraints due to a variety of factors. The burden of taxation, including income tax, National Insurance, and pension deductions, significantly reduces their take-home pay. In addition, expenses such as rent, council tax, loan repayments, and vehicle insurance further add to their financial struggles.

Insights and Unique Ideas:

One unique aspect to consider is the impact of globalization on both issues. As Nigeria's economy is integrated into the global market, external factors such as Brexit and the COVID-19 pandemic play a role in shaping the financial landscape. The challenges faced by Nigerians in the UK, including the growing population and economic uncertainties, highlight the interconnectedness of economies and the need for comprehensive solutions.

Actionable Advice:

  • 1. For the Government: In its efforts to curb inflation, the government should take a comprehensive approach that includes both monetary and fiscal measures. While controlling the growth of money supply is crucial, equal attention should be given to prudent disbursement of funds by federal, state, and local governments. This will help strike a balance between ensuring adequate money supply for economic growth and preventing excessive inflation.
  • 2. For Nigerians in the UK: To overcome financial constraints, Nigerians in the UK should prioritize financial planning and budgeting. Understanding the tax system and seeking professional advice can help optimize their earnings. Exploring options for tax relief and investment opportunities can alleviate some of the financial burdens and provide long-term financial stability.
  • 3. Collaboration and Support: Both the government and Nigerians in the diaspora should foster collaboration and support systems. The government can establish platforms for dialogue and engagement with the diaspora community to understand their challenges better and explore solutions together. Nigerians in the UK can also create networks and support groups to share experiences, tips, and resources, providing a sense of community and collective empowerment.

Conclusion:

The government's plan to reduce the circulation of cash as a measure to curb inflation intersects with the financial constraints faced by Nigerians in the UK. Both issues highlight the need for balanced economic policies and individual financial planning. By implementing comprehensive measures and fostering collaboration, the government and Nigerians in the diaspora can work towards alleviating financial burdens and promoting economic stability.

Resource:

  1. "Wale Edun: FG To Curb Rising Inflation With ‘Cut In Money Supply’ - Politics - Nigeria", https://www.nairaland.com/7813555/wale-edun-fg-curb-rising (Glasp)
  2. "6 Strong Reasons Why Nigerians In The UK Are So 'stingy' - Travel - Nigeria", https://www.nairaland.com/7813125/6-strong-reasons-why-nigerians (Glasp)

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