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Detty December: It’s The Currency Devaluation, Plain And Simple!

The phrase, “It’s the economy, stupid”, gained prominence during Bill Clin­ton’s successful 1992 U.S. presidential campaign, thanks to strategist James Carville. It served as a directive to campaign staff, urging them to focus on key economic issues to sway voters. In a similar vein, the title of this piece—‘Detty December: It’s The Currency Devaluation, Plain and Simple!’— is aimed at highlighting a core factor behind the recent surge in economic activities and festivities in Nigeria during December: the significant devaluation of the naira.

This devaluation prompted many Nigeri­ans living abroad to return home to celebrate the holidays with their families, spurring an unprecedented wave of revelry and tourism. As I see it, this marks a tangible benefit of President Tinubu’s socioeconomic reforms. Without a doubt, December’s economic boom, particularly in Lagos, was fueled by diaspo­rans’ spending and benefited various service providers, including hotels, car rental busi­nesses, nightclubs, cruise operators, and food vendors. Even microeconomic activities saw funds trickling down the value chain, driven by the influx of diasporans escaping winter from overseas.

Until now, the positive impact of this deval­uation had gone unnoticed or unacknowledged by many, especially critics who dismissed my earlier piece, ‘Governing Nigeria is Tough, But Tinubu is Achieving Remarkable Progress’ (published in ThisDay on Christmas Day, 2024). In that article, I suggested that the Nigerian economy was beginning to thaw. However, some skeptics failed to appreciate the role the weaker naira played in the remarkable eco­nomic activities witnessed during December, particularly in Lagos.

With the naira trading between N1,166 and N1,750 to the dollar by December, the exchange rate was nearly four times what it was before Tinubu assumed office in May 2023. For di­asporans, this provided a unique advantage. Take, for instance, a nurse or doctor in the UK who migrated (or ‘japa-ed’) and suddenly found their £1,000 paycheck converting to a minimum of N2 million at the rate of N2,000 to £1. Such individuals could easily afford a luxurious week-long stay in Nigeria, renting hotels or short-let apartments, hiring cars, en­joying boat cruises, dining out, and indulging in Lagos’ vibrant nightlife.

This windfall spending by diasporans, as highlighted in a recent revealing report, un­derscores the vital role currency devaluation played in creating the economic dynamism of December 2024. It’s a phenomenon that fur­ther validates the optimism expressed in my earlier commentary about Nigeria’s evolving economic landscape.

By now, many readers may have come across the insightful analysis of Nigeria’s eco­nomic activities during December 2024, partic­ularly in Lagos. However, for those who might have missed this remarkable report—which has gone viral on social media and received sig­nificant attention in traditional media—I will summarize its key points to provide context for the discussion on how naira devaluation has driven positive economic outcomes.

One of the reports, authored by Mr. Kayode Osebi, a consultant to the Lagos State govern­ment on taxation and revenue, was reportedly commissioned by the Lagos State government. While the accuracy of the research cannot be independently verified, the data aligns with the economic realities experienced during December. Below are the highlights:

• Inbound Passenger Traffic: Between No­vember 19 and December 26, 2024, Lagos Air­port (MMA) recorded approximately 550,000 inbound passengers, 90% of whom were Nige­rians in the diaspora visiting for leisure and tourism.

• Tourist Origin and Destinations: The top five originating countries were the U.S., Can­ada, Italy, South Africa, and the U.K., while Lagos, Edo, Delta, Ondo, and Ogun states were the top destination states. Lagos alone hosted an estimated 1.2 million tourists, 60% of whom were local tourists from the South East and FCT.

The report also noted that insecurity in the South East and President Bola Ahmed Tinu­bu’s presence in Lagos contributed to the in­flux of visitors.

• Hotel Revenue: Hotel bookings generated an estimated N54 billion ($36 million) in rev­enue, with 15,000 confirmed bookings in De­cember. Guest spending on food and beverages amounted to N13.5 billion ($8 million), while the top 15 hotels accounted for N10.5 billion in bookings.

• Short-Let Apartments: Short-let apart­ment bookings were valued at N21 billion ($13 million) across 5,937 apartments, with an aver­age daily rate of N120,000. Eko Atlantic ranked highest in residential bookings, while Banana Island recorded the highest estate bookings by value.

• Nightlife and Recreation: The top 15 loung­es and nightclubs generated N4.32 billion ($2.7 million) in sales, with daily revenues averaging N360 million and table spending averaging N1.2 million. Beach and resort bookings brought in an additional N4.5 billion ($2.8 million), with Ilashe/Ibese and Elegushi beach houses lead­ing in revenue.

Other highlights included:

• Event centres earning N1.2 billion ($804,000) from 1,175 bookings.

• Car rentals in the Eti-Osa area generating N1.5 billion ($937,500) from 750 high-end vehi­cle bookings, with daily rates reaching as high as N2 million.

• An additional N20 billion ($13 million) in revenue from recreational activities such as artist bookings, fine dining, boat rentals, and DJ services.

These figures, compiled by Mr. Osebi, align with another Lagos-based report titled ‘The Economics of Detty December’ by Growing­Nigeria.com. Both reports highlight the signif­icant inflow of funds into the Nigerian econ­omy during the festive period, particularly in Lagos, which served as the epicentre of the festivities.

What stands out most is the sheer scale of money injected into the economy by Nigerians in the diaspora. Instead of enduring the cold winters in Europe and North America, many returned home to celebrate with their families, spurring economic growth. Their spending fueled a near-carnival atmosphere, attracting Afrobeat enthusiasts and tourists from around the world, reminiscent of how reggae music was popularized globally in the 1990s by icons like Bob Marley.

The Bigger Picture

To fully appreciate the significance of Detty December, it is essential to consider its broader economic implications. A summary of the ref­erenced report captures it succinctly:

“Detty December has evolved from a simple season of family time and Christmas jollof into a global attraction for diasporans, tour­ists, and Afrobeat lovers. Whether through concerts, beach parties, weddings, or fashion shows, this cultural phenomenon has become a time to experience everything Nigeria has to offer. But beyond the good vibes, have you ever stopped to think about the economics of it all?”

This lighthearted description transitions into a deeper discussion about the massive inflow of foreign exchange into the Nigerian economy. Once converted into naira, these funds were used for lifestyle and entertain­ment, creating significant economic benefits, particularly for Lagos.

Clearly, Detty December in Nigeria did not commence in 2024. But the exceptional turnout and outcome of the celebrations last December have been exceptional. That is because of the naira devaluation under Tinubu’s watch. Not many commentators including the authors of the headlines hugging reports viewed the Detty December phenomenon from that prism.

Conventionally, nations prefer their cur­rencies to be weak to boost exports and trade because the lower the value of a country’s currency, the more she will be exporting as lower costs attract importers. This can help stimulate economic growth, create jobs, and improve the trade balance.

Critics may argue that Nigeria need not devalue her currency simply because it has nothing substantial to export, except crude/ refined petroleum products which in any case the price is being determined by the Organiza­tion of Oil Producing Countries, OPEC.

I would argue that such a point of view is not exactly correct. That is because the huge number of Nigerian professionals in health care and Fintech migrating abroad are actual­ly our exports. India and the Philippines gen­erate enormous revenue from their human resources working in the diaspora.

The potential of Nigeria’s diaspora popu­lation is evidenced by the CBN data cited by the authors/researchers of the Detty Decem­ber survey where it was noted that over $20 billion was remitted by diasporan Nigerians back home in 2022 and reflective of how the economic landscape of Lagos was impacted for good last December.

In light of the above, is it not preposterous that there was a time when the agenda of some of our political leaders during campaigns was making the naira exchange rate at par with the dollar i.e N1 equal to $1?

Thankfully, President Tinubu is not one of those romanticizing the so-called good old days of the naira exchange rate being higher than the pound sterling and dollar.

In conclusion, Detty December has show­cased the untapped potential of Nigeria’s tourism sector. With the right policies and infrastructure, the nation could transform this seasonal boom into a year-round driver of economic growth.

Tragic December: Lessons For Nigeria’s Tourism Potential

Before diving further into the economic gains generated by Detty December in Nige­ria, it’s important to reflect on the tragedies that marred the same period. In my column titled, ‘Tragic December: Why Can’t Palliatives Be Distributed Dangote Way?’, I addressed the unfortunate loss of over 70 lives in stampedes during food and palliative distribution events in Ibadan, Abuja, and Okija between Decem­ber 18 and 21.

These avoidable tragedies underscore the ur­gent need for Nigeria’s national and subna­tional governments to enact laws regulating the distribution of aid to prevent such disas­ters in the future. Similar historical incidents, such as the 1929 St. Valentine’s Day Massacre in Chicago, prompted legal reforms in the U.S. to safeguard lives during public events. Nigerian lawmakers should take inspiration from such examples and establish regulations to prevent harm during public gather­ings.

The heartbreaking losses during December meant that many families were plunged into mourning during what should have been a time of celebration. This stark contrast highlights the need to ensure that future festivities are not tainted by avoidable tragedies.

The Economics Of Detty December

Returning to the report titled, ‘The Economics of Detty December’, by a firm known as GrowingNi­geria, the document reveals the massive economic boost generated by festive activities, particularly in Lagos. The editors highlighted how Detty December has evolved into a major economic driver, attracting foreign currency and stimulating various industries.

Key Insights:

1. Diaspora Contributions: Nigerians in the di­aspora, carrying foreign currencies, are central to the December economic boom. The Central Bank of Nigeria (CBN) reported diaspora remittances exceed­ing $20 billion in 2023, a significant portion of which flowed in during the festive season.

2. Tourism and Spending: Dollars, pounds, and eu­ros exchanged at airports and PoS machines across Lagos fueled spending on flights, hotels, events, and cultural activities. Custom-made outfits (aso-ebi) for weddings and events further benefited local artisans.

3. Ripple Effects: Industries such as hospitality, logistics, events, and even local crafts saw significant liquidity. As the report noted: “Detty December is more than a social calendar; it is a money-making machine.”

Unlocking Nigeria’s Tourism Potential By Replicating Detty December Financial Boom Nationwide.

The economic success of Detty December under­scores Nigeria’s untapped tourism potential. Howev­er, the benefits are currently concentrated in Lagos. To fully harness tourism, the following steps must be prioritized:

1. Addressing Insecurity: The lingering insecuri­ty in Nigeria, particularly in the northern regions, must be tackled. President Bola Ahmed Tinubu and National Security Adviser Nuhu Ribadu must work to dissuade religious insurgents through persuasion and economic opportunities rather than relying sole­ly on military force.

• Example from Islamic Countries: Countries like Saudi Arabia, the UAE, and Egypt, despite being Is­lamic nations, have leveraged tourism as a significant income source. For instance, Saudi Arabia earned $36 billion from tourism in 2023, contributing 11.5% to its GDP.

2. Tourism as a Tool for Peace: By creating job op­portunities in tourism, the government can redirect those involved in insurgency toward productive ac­tivities. Former militants could serve as tour guides or offer other services, as seen in the Middle East and North Africa.

3. Diversifying Tourism Beyond Lagos: Authori­ties should promote tourism nationwide, leveraging Nigeria’s vast cultural and natural attractions. Lagos should remain a hub, but other states with rich histo­ries and unique landmarks must also be developed as tourism destinations.

Comparisons To Global Tourism Earnings

Despite Nigeria’s size and cultural wealth, its tourism revenue in 2022 was only $17.3 billion, rep­resenting just 3.6% of its GDP. This pales in com­parison to:

• Saudi Arabia: $36 billion (11.5% of GDP in 2023)

• UAE: AED 220 billion (11.7% of GDP in 2023)

•Egypt: $15 billion (2023)

With strategic planning, improved security, and proper investments, Nigeria could significantly in­crease its tourism revenues and reduce reliance on oil.

Detty December has proven that tourism is a vi­able path for Nigeria’s economic growth. The chal­lenge now lies in extending its benefits nationwide while addressing the structural issues holding the sector back.

We can emulate Egypt which is an African coun­try deeply rooted in Islam yet they welcome foreign­ers as tourists to live amongst them.

In Egypt for instance, there is a city known as Sham El Shek. It is a purpose-built location for Eu­ropean tourists who have established their winter homes over there. Currently, owing to climate change effects, Europe and North America -USA and Canada are frozen with the elderly ones anxious to relocate to countries with more clement weather.

The weather and environment of Sham El Shek is not different from what is obtainable in Kaduna and Kano states in Nigeria.

There are even tourist locations such as Tiga Dam around Kaduna and Kano.

Ordinarily, the Europeans spending their winter in Egypt could have done the same in Nigeria.

But they are unable to do so owing to insecurity imposed on the areas by religious extremists and bandits including herders-farmers engaging in vio­lent clashes.

The same panacea being proposed for the north­ern parts of Nigeria applies to the unknown gunmen, ravaging the South East also known as separatists and environmental rights activists who have become militants in the Niger Delta.

The faith-based institutions and priests in those regions also have a role to play in persuading the angry Nigerians engaged in rebellion against our country in multiple guises, that it is time to give peace a chance so that we can all harness the immense po­tentials of our beloved country for the greater good of all.

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