As reported earlier, President Muhammadu Buhari will be in Lagos on a two-day official visit starting today, Thursday, March 29 through Friday, March 30.
To make sure the President does not see or understand the suffering in the state, the Lagos State Government shut down some routes, and many businesses including banks, shops, and markets were shut in Nigeria’s economic capital – so, it seems obvious that all is well.
As the shut down began, so many citizens were forced to trek long distances to their workplaces as security agents made sure commercial vehicles were off the road.
But that is not all.
The decision to declare a work-free day comes with an opportunity cost to the State in terms of loss of economic value created and salaries paid for work not done.
In 2017, the governor of Lagos, Akinwunmi Ambode described the state as the fastest growing megacity in the world, just as he revealed that its Gross Domestic Product GDP has hit $136 billion.
The governor added that the state accounts for over 90 percent of Nigeria’s foreign trade flow, which invariably contributes 30 percent to the country’s GDP and also accounts for 65 percent of its manufacturing activity.
His words, “Lagos, as the economic capital of Nigeria and the West African sub-region with a 136 billion USD GDP, accounts for over 90 percent of Nigeria’s foreign trade flow, contributes 30 per cent to the country’s GDP and also accounts for 65 percent of its manufacturing activity”.
“It is our desire to see a prosperous Lagos that we will all be proud of, in terms of investment, open for business for the benefit of all.”
More recently, the state claims it has an estimated GDP of $90 billion (N32,400,000,000,000). By calculation, this equates to N8.8 billion per day when there is no economic activity. You can calculate what amount is lost when there is 50 percent loss in value of economic activity.
For salaries: Unfortunately, the most recent published accounts of Lagos was for the year ended December 2015.
In the account, the state claims personnel costs amount to N86.3 billion annually. Dividing that into 12 months and 22 working days in March amounts to about N327 million.
If we are to add all that up – 50 percent loss of economic activity and salaries paid for no job done – it totals to:
≅ N4.7 billion.
Are we even going to start the ‘mathematics’ for the cost the state will bear as a result of the Presidential visit?