Naira Metrics : Price Surge in Nigerian Economy

Challenge Background

The Nigerian economy has experienced a significant surge in prices across various sectors, from daily commodities to services and products. This rapid change has impacted living conditions across different states, prompting a detailed analysis of key economic pillars such as incomes, expenditures, and savings capabilities of citizens.

Goal of the Project

This project aims to provide a clear and actionable overview of the economic impact of price surges in Nigeria, facilitating informed decision-making and policy development.

The goal also is to present a graphical overview of the price increases in selected basic living needs. These include:

• Food Items: Tracking the price changes in staple foods.
• Cost of Transportation: Monitoring the cost variations in public and private transportation.
• Taxation: Observing changes in tax rates and their implications.
• Wages: Comparing the wage trends against the rising cost of living.
• Healthcare: Analyzing the cost fluctuations in essential healthcare services.
• Essential Commodities: Investigating the price movements of key commodities.

Data Collection and Indicators

Data has been collected on various indicators essential for analyzing price surges in Nigeria. The detailed tracking of these indicators can be found in our Indicators/Features Tracker.

• Comprehensive tracking of metrics such as government expenditure, trade openness, GDP, unemployment rate, oil production, inflation rate, exchange rate, and more.
• Data sourced from reputable databases like CBN, World Bank, NBS, and others.

Data Preprocessing

Data was cleaned and preprocessed. After that the multiple file were merged based on their starting year/month

• 1960 Onwards
• 1980 Onwards
• 1990 Onwards
• 2000 Onwards

Exploratory Data Analysis

Introduction

This report provides an in-depth analysis of Nigeria's economic and demographic trends from 1960 onwards, focusing on key sectors, population dynamics, inflation trends, and the interplay between petrol prices and economic performance.

EDA Observations Table

Section	Observation
GDP Insights	GDP in Constant and Current LCU: Correlation: 0.994, Trend: Significant upward trend, indicating sustained economic growth.
	GDP per Capita and Growth: Correlation: 0.501, Trend: Moderate positive correlation, suggesting a relationship between overall economic output and individual income growth.
Population Dynamics	Total, Female, and Male Populations: Strong correlations across demographic segments.
	Age Groups: Correlation: -0.992 between young (0-14 years) and working-age (15-64 years) populations, Trend: Steady growth with annual rates around 2%.
Petrol Prices and GDP	Correlation with GDP: 0.229, Correlation with per capita GDP: 0.286, Trend: Steady increase from the late 1990s, influenced by global oil price changes.
Inflation Trends	1981: Extremely high rates post oil price collapse, 1988-1989, 1992-1995: High inflation due to economic instability and reforms.
Financial and Monetary Indicators	Total Reserves: Significant increase over the years. Narrow Money and Money Supply (M3): Noticeable upward trends.
Credit to Private Sector	Trend: Steady increase in credit to private sector.
Oil Sector Insights	Crude Oil Prices: Volatility with significant peaks and troughs. Cumulative Production: Clear upward trend in oil extraction.
Sectoral Trends Over Time	Services, Agriculture, Industry: Various trends and growth patterns noted, with services showing substantial growth post-2000.
Monetary Policy	Recent Trends: Sharp increase in recent years, with fluctuations showing periodicity.
Debt and Unemployment	Relationships: Weak positive between debt and unemployment; moderate positive between unemployment rate and export rate.
EDA Report on Interbank Call Rate	Overview: Analysis of factors influencing the Interbank Call Rate in relation to the Nigerian economy's price surge.
Statistical Breakdown of Columns	Interbank Call Rate: Average of 11.5%, median of 10.5%, with fluctuations over time.
Monthly Fuel Price	Distribution: Right-skewed with occasional high spikes.

Omdena

This project was created in collaboration with Omdena Kaduna Chapter, where I worked as a Lead Machine Learning Engineer. Omdena is a global platform that collaborates on real-world problems through AI innovation, bringing together engineers, researchers, and domain experts.

Link: https://www.omdena.com/chapter-challenges/quick-view-of-price-surge-in-nigeria-economy-using-data-science