Temitope Ajayi, Senior Special Assistant to President Tinubu on Media and Publicity, has said labour and Nigerians are doing the country disservice by comparing N62k minimum wage proposal to $40.
Ajayi said it is “disingenuous” to look at the N62,000 minimum wage from $40. He said Nigeria’s currency remained the Naira and not the US Dollar. According to Ajayi, Labour should accept the N62,000 minimum wage. He argued that N62,000 minimum wage has more purchasing power in Nigeria, than the purchasing power of $40 in the United States.
“One other disingenuous point around the ongoing minimum wage debate in Nigeria is the dollar comparison. Those making the point that the N30,000 minimum wage is equal to $30 and the proposed N62,000 is $40 are not telling the full story,” Temitope said.
Giving further explanation on the purchasing power of N62,000 in Nigeria and $4o in the US, Ajayi added, “One, dollar is not our national currency. Two, cost of living in a country determines wages. Three, the people making the dollar equivalent argument are ignoring Purchasing Parity. What can you buy with $1 in US and what can you buy in Nigeria with naira equivalent of $1?
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“Whereas $1 can not buy a meal in US but it’s equivalent (N1500) will buy good meal in a decent restaurant in Nigeria. A vegetable you will buy for $10 in US which is about N15,000 in Nigeria wont cost more than N1000 or less at Wuse market in Abuja.
“One month rent for a 3 bed-room flat in a medium income neighbourhood in US is more than 1 year rent for same type of house in the heart of Ikeja in Lagos. All of these must be put in perspectives when making the dollar argument.”
Tinubu’s SSA on Media and Publicity further defended the N62,000 minimum wage when compared with other African oil producing countries. Ajayi said Angola, Algeria, Tunisia, Kenya, DR Congo, Gabon, Cameroon and Ghana have higher minimum wages than the government’s proposal because the cost of living in the countries is higher than in Nigeria.
“Statistics and numbers can be misleading depending on how they are presented. The table does not give the full picture. It is not enough to present naira equivalent of minimum wage in Angola, Algeria, Tunisia, Kenya, DRC Congo, Gabon, Cameroon, Ghana etc. The question to ask is: what is the cost of living in these countries?” Ajayi defended.
Ajayi argued further that the Value Added Tax (VAT) generated by the government from the African oil producing countries paying higher wages than Nigeria are more than that of Nigeria. “These are countries where VAT is between 15-21%. Countries where personal income tax rate is higher than that of Nigeria. Even with our current economic challenges, it is still far cheaper to live in Nigeria than any of these countries. In these countries, the cost of house rent, basic food items are higher than what is obtainable in Nigeria. A bottle of coke that sells for N300 in Nigeria sells in these countries for between N800-N2000 equivalent,” Temitope added.
