The United States of America has contradicted Director-General of the World Trade Organisation (WTO), Dr. Ngozi Okonjo-Iweala, over the state of Nigerian economy, saying that the new minimum wage of N70,000 had been undermined by the continued depreciation of the Naira.
Recall that Ngozi Okonjo-Iweala had on August 14 commended President Tinubu’s administration’s reforms by restoring stability to Nigeria’s economy.
“You cannot really improve an economy unless it’s stable. The President and his team have worked hard to stabilise the economy. The reforms have been in the right direction. The next step is growth, alongside building social safety nets so those feeling the pinch of reforms can get support,” the former Finance Minister stated in Abuja, after a meeting with Tinubu at the Presidential Villa.
However, and in contrast, reports on Human Rights Practices released by its Department of State, Bureau of Democracy, Human Rights and Labour, the US also identified lengthy pre-trial detention and delays as major challenges facing justice delivery in Nigeria.
The report also said the new minimum wage of ₦70,000 had been undermined by the continued depreciation of the Naira. It noted that the new wage, pegged at about $47.90 per month, had lost its value due to the naira trading at over ₦1,500 to the dollar.
The report, which added that firms with fewer than 25 workers did not benefit from the wage increase, stated: “The National Minimum Wage (Amendment) Act 2024 doubled the minimum wage to ₦70,000 ($47.90) per month. Despite the increase, currency devaluation meant the minimum wage was no longer higher than the poverty income level. Many employers had fewer than 25 employees, so most workers were not covered”.
The law provides a national minimum wage for employers with 25 or more full-time staff, with exceptions for seasonal agricultural workers, part-time employees, and commission-based roles.
The US report further observed that some states had declined to implement the law, citing financial constraints, and also pointed out gaps in enforcement.
According to the report, between 70 and 80% of Nigeria’s working population operates in the informal economy, whereby authorities fail to enforce wage, hour and occupational safety and health laws.
