LAGOS, Nigeria — Like many of Nigeria's middle class, Tunji Lawal-Solarin, an oil economist, was solidly addicted to the good life of low-priced imports.
For the past decade, hundreds of thousands of office workers, professors and businessmen here could afford new French cars every year or two, champagne, an occasional weekend jaunt to Europe, Japanese color TVs and video recorders. Enough was usually left over from their modest paychecks to send a couple of children to school abroad.
Now that comfortable life style has been snatched away.
The prices of imported luxuries, for years kept at bargain levels by the country's wildly unrealistic exchange rate, quadrupled in a matter of weeks last fall when Nigeria's military rulers launched a drastic and sweeping plan to restructure the economy.
Nigeria has suddenly stopped living beyond its means, and many, like Lawal-Solarin, have had to give up their import addictions.
"The bottom line today is you have to look inward, to Nigeria, to survive," says Lawal-Solarin, whose strategy is to spend his weekends turning 250 acres of spongy tropical growth into a working farm.
To the surprise of almost every international expert and quite a few Nigerians as well, the government's plan to rescue itself from an economy almost irreversibly out of whack has survived--and begun to work. With this, some fundamental assumptions about Nigeria and Nigerians have been changing as well.
The rest of Africa is watching. If a program of austerity and capitalism can nudge Africa's most populous country toward self-sufficiency, it could work anywhere.
"It's truly amazing what has transpired here, and it's left more than a few of us dumbfounded," said a Western financial expert who has followed Nigeria's transformation. "There was the potential here for real disaster--runaway inflation, unrealistic exchange rates, or even a \o7 coup d'etat. \f7 None of that happened."
Economy Looking Up
Instead, international lenders are opening their billfolds again, ships again crowd Lagos harbor, the corruption that went hand in hand with doing business in Nigeria has diminished and prices for export crops, such as cocoa, have tripled.
The bold program began in September, when the government had a foreign-exchange auction. Nigeria's currency, the naira, valued officially at one naira to one dollar, plunged so far and so fast that Nigerians were stunned. It fell swiftly to three naira to one dollar and stabilized recently at four to the dollar.
Middle-class Nigerians, earning 16,000 to 30,000 naira a year, saw the imported car that cost 7,000 naira a few months before become a 30,000-naira car. A color TV jumped from 900 naira to 3,800 naira, refrigerators from 500 naira to more than 2,000 naira.
The cost of international air travel doubled, but the government blocked an even sharper increase and the airlines complained that the doubling was not enough to offset the devaluation. Pan American did more than complain: It abolished its twice-weekly flights between Lagos and New York and pulled out of the country.
Lagos No Longer Expensive
Foreign visitors to Nigeria, however, got a pleasant surprise. Lagos' well-deserved reputation as one of the most expensive cities in the world disappeared abruptly; it is now quite reasonably priced for foreigners carrying dollars or other hard currencies.
A standard 150-naira room at the Eko Holiday Inn, which for years cost the equivalent of $150, costs about $40 at the new exchange rate. The tab for lunch at an undistinguished Chinese restaurant used to be 60 naira, or $60. Today, even with a recent price rise, the same meal costs the equivalent of $16.
Along with the currency revaluation, Nigeria abolished its notoriously corrupt import-licensing system, cutting off the multitudes of civil servants and middlemen--importers-cum-traders who made fortunes by manipulating the system.
The government then closed six commodities boards, whose bureaucratic inefficiency and corruption had discouraged farm production in the country.
Certain imports--champagne, vegetable oil and furniture, among others--were barred to encourage Nigerians to use locally produced alternatives.
Wheat Being Cut Off
Wheat, the principal U.S. export to Nigeria, is among the commodities banned. When present wheat stocks disappear, so will the country's bread, unless wheat is smuggled in from Nigeria's neighbors.
Although wheat accounts for less than 10% of the country's food requirements, many Nigerians have acquired a taste for bread and sweet cakes, especially with breakfast. The government says the country will try growing its own wheat, or substitute corn.
"We are telling our people to be self-reliant," said Tony Momoh, the minister of information and culture. "You can no longer achieve much in this country through importation."
Many here are taking his advice to heart.