Christmas: Why returning Nigerians may not spend as much?

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A recurring feature of Christmas in Nigeria is the I just got back (IJGB) freak. In case this is new to you, let us illustrate: IJGB is an acronym used to describe Diaspora Nigerians whenever they visit the country, especially during the Christmas season.

As you may know, many Diaspora Nigerians live and work in high-income countries. And this increases their spending power every time they visit Nigeria, which invariably benefits the economy by encouraging cash flow for retailers and service providers.

They are important for the economy: The Nigerian diaspora also plays an important role in the country’s monetary policy through remittances.

  • previous nairametry reported that Nigeria received $10.11 billion as diaspora remittances between January and June 2022, representing an increase of 9.6% compared to the $9.23 billion received during the same period last year.
  • The World Bank has Estimate Foreign remittances to Nigeria will reach $20.9 billion by the end of 2022, compared to $19.5 billion in remittance inflows in 2021, an increase of 7.5%.

But what about your expenses? Many Nigerians in Western countries, in the last 12 months, have seen their standard of living drop due to inflation caused by many factors. Some of these factors include the impacts of post-pandemic quantitative easing monetary policy, rising energy prices due to the Russian invasion of Ukraine, etc.

  • Nigerians in the UK recently I have a little breather after the inflation rate in the country fell 10.7% in November from 11.1% in October. But the economic challenges in the UK economy are far from over.
  • Nigerians in the United States have also had their fair share of economic challenges. But luckily, inflation is subsiding as the US consumer price rises. reduced higher than expected to 7.1% in November, its lowest level since December 2021.

High prices, falling disposable income: As consumers across the Western Hemisphere saw their spending rise to a 40-year high, they also saw their standard of living fall.

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  • Along the same lines, their disposable income has fallen significantly, with the UK government revealing that UK households could see a 7.1% drop in living standards over the next two years.
  • real disposables income will fall by 4.3 percent in the 2022-23 fiscal year, the biggest drop since records began in 1956-57.
  • These factors add to how consumers can spend as they reduce their spending, which could see controlled spending to see how the start of the year goes in energy and food prices.

The bottom line: Despite falling disposable income, remittances from diaspora Nigerians are still holding steady, which could also be due to increasing intellectual capital flight from Nigeria.

Remove Nairametrics reported that Nigerian student visa approvals to the UK increased from 8,384 to 65,929 from the year ending 2019 to the year ending June 2022, an increase of 686%.

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Also reported is that Nigerian citizens emerged as the second highest recipients of UK work visas between December 2019 and June 2022.

  • However, despite the positive outlook, diaspora Nigerians who decide to return home this Christmas may be more frugal with their spending than usual.

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