Nigeria: Electric grid crippled as workers go on strike

World Tuesday 04/June/2024 17:02 PM
By: DW
Nigeria: Electric grid crippled as workers go on strike

Abuja: Two of Nigeria's largest trade unions called an indefinite strike starting on Monday, with the walkout already crippling the national electricity grid and air travel.

Talks with the government on a new minimum wage, meant to cushion the impact of inflation of more than 30%, recently broke down.

The ongoing protest is the fourth large strike staged by the Nigerian Labor Congress (NLC) and Trade Union Congress (TUC) since President Bola Tinubu took office last year and launched a far-reaching set of economic reforms.

Power grid goes offline overnight
Electricity and aviation unions had directed their workers to withdraw their services and comply with the strike call, union representatives said in a statement on Monday.

The national electricity provider, the Transmission Company of Nigeria, said that union members drove away operators at the country's power control rooms and shut down at least six substations overnight.

This led to a shutdown of the national grid as of 2:19 a.m. local time (0019 GMT/UTC), it said.

Nigerian airline Ibom Air said it was suspending flights until further notice, while another, United Nigeria, said airports across the country had been shut down and that striking workers were preventing it from operating.

Inflation runs high amid Tinubu's reforms
After taking office in May 2023, Nigeria's President Bola Tinubu embarked on a bold set of economic reforms, which he argues were necessary and would bear fruit in the future.

But Tinubu's reforms, coupled with macroeconomic impacts following the COVID pandemic and amid Russia's invasion of Ukraine, have put additional upward pressure on inflation, which rose to an almost 30-year high of more than 30% this year.

Slowing growth rates and a reduced government tax intake have exacerbated the problems. Already saddled by high debt repayments, Nigeria is currently running an annual budget deficit in the region of 5% of GDP.

Tinubu's administration also took the controversial step of scrapping government subsidies on petrol in the oil-rich country.

These payments kept fuel cheap, but also cost the government roughly $10 billion (almost €9.2 billion) in 2023. That comfortably outstrips the government's share of revenues from selling oil, even as the world's ninth most prolific exporter.

Critics of fuel subsidies, including environmentalists, argue that the subsidies are ultimately counterproductive. They claim such measures tend to benefit relatively affluent people, rather than the country's poorest, while also reducing governments' spending power in other core areas like education, healthcare, infrastructure and national security.