Truly unfortunate with these reversals: “In a surprising and abrupt move, the Nigerian government has withdrawn its recently announced plan to sell subsidized 50-kilogram bags of rice to public servants at the discounted price of N40,000. This decision, which was initially intended as a relief measure amidst ongoing national protests against rising food prices and inflation, has left many Nigerians bewildered, as no official reason was provided for the sudden reversal.”

In the Igbo Nation, there is an explanation – “no man, no matter how wealthy, can prepare enough food for his kinsmen, but if those kinsmen make food for him, he will be unable to consume the whole food”. That proverb is saying: the Nigerian government, no matter how loaded with cash, cannot “cook” for Nigerians, and any effort to try that is pure stupidity. So, there is nothing surprising that the government has disconnected the policy before it began at scale.

Yet, this goes beyond “cooking” because if your village cooks for you, you are done and finished even though the village can consume whatever you bring. The Nigerian government must think over these policies before announcing them, to avoid all these avoidable own goals and mindless reversals.

No government should allow its citizens to cook for it, and maintaining that equilibrium involves communicating honestly. Yes, do not over-promise what you cannot do!

Nigeria Abruptly Halts Sale of N40,000 Subsidized 50kg Rice to Public Servants

In a surprising and abrupt move, the government has withdrawn its recently announced plan to sell subsidized 50-kilogram bags of rice to public servants at the discounted price of N40,000.

This decision, which was initially intended as a relief measure amidst ongoing national protests against rising food prices and inflation, has left many Nigerians bewildered, as no official reason was provided for the sudden reversal.

The announcement of the subsidized rice sales came on August 1, 2024, through a memo issued by the Ministry of Special Duties and Inter-Governmental Affairs’ Human Resources Management Department. The initiative was a direct response to the escalating national protests that had gripped the country, driven by widespread discontent over the spiraling cost of living and, in particular, the soaring prices of essential food items like rice.

In the memo, which was signed by Mrs. Jaiyesim Abimbola Aderonke, Director of Human Resource Management, the government outlined a plan to sell 50-kilogram bags of rice at a subsidized rate of N40,000 per bag to public servants in Abuja. This was part of a broader strategy to alleviate the economic pressures facing government employees, many of whom are struggling to cope with the effects of inflation and the devaluation of the naira.

Public servants were instructed to register their interest through a Google form on the Office of the Head of the Civil Service of the Federation (OHCSF) website and submit the necessary documentation to their respective Directors of Human Resources for endorsement.

The distribution of the rice was to be overseen by designated officials, with the involvement of the Chairman of the Joint Union Council of the Ministry to ensure transparency and fairness in the process.

The Sudden Withdrawal

However, just a day later, on August 2, 2024, a follow-up memo announced the abrupt withdrawal of the subsidized rice sale. The memo, again signed by Mrs. Jaiyesim, offered no explanation for the decision and simply stated that the earlier directive had been rescinded, with further details to be communicated at a later date.

“I am directed to refer to our internal circular in the Ministry (Federal Ministry of Special Duties and Inter-Governmental Affairs) of 1st August. 2024 on the above subject matter and to inform you that the Internal Circular is hereby withdrawn.

“Further details will be communicated in due course. Please, bring the contents of this internal circular to the attention of staff in your respective Departments and Unite for their information and proper guidance,” Jaiyesim announced.

The unexpected reversal has sparked confusion and frustration among public servants, many of whom had been hoping on the subsidized rice to manage their household budgets amid the ongoing economic crisis. The lack of transparency and communication from the government regarding the reasons behind the withdrawal has only added to the growing sense of discontent among the population.

Background: The Hunger Crisis and Nationwide Protests

The decision to offer subsidized rice to public servants was made against the backdrop of a severe hunger crisis that has been brewing in Nigeria for years. The crisis, driven by a combination of factors including high inflation and currency devaluation, has led to a sharp increase in the prices of staple foods, pushing many Nigerians into food insecurity.

Rice, a staple food for millions of Nigerians, has been particularly affected by these economic pressures. In recent months, the price of rice has skyrocketed, reaching up to N90,000 per 50kg bag – making it unaffordable for a significant portion of the population. This has led to widespread public anger and frustration, culminating in the national protests that began on August 1, 2024.

The protests, which have continued for days, have seen thousands of Nigerians take to the streets in major cities across the country, demanding government action to address the rising cost of living and provide immediate relief to those most affected by the crisis. The demonstrators have called for the government to implement measures to stabilize food prices, improve access to essential goods, and address the underlying economic issues that have contributed to the current situation.

Government Efforts

The federal government’s major response to the hunger crisis included the distribution of rice and funds to states. This is in addition to the subsidized rice initiative, which was announced as a part of broader efforts to mitigate the impact of rising food prices.

However, the sudden withdrawal of this measure has cast doubt on the government’s commitment to addressing the crisis. Critics argue that the government’s actions have been inconsistent and insufficient in the face of a growing emergency.

Furthermore, the timing of the withdrawal has fueled speculation that the government may be struggling with logistical challenges or facing pressure from other quarters, leading to the reversal. Some analysts suggest that the government’s fiscal constraints, exacerbated by the economic fallout from the recent economic reforms and ongoing security challenges, may have played a role in the decision to halt the rice sales.

Previous Government Interventions

The subsidized rice initiative was not the first time the government has attempted to intervene in the food market to alleviate pressure on Nigerians. In previous months, similar efforts were made to distribute grains from strategic reserves and provide food aid to vulnerable people across the country.

However, these interventions have often been criticized as being too little, too late, with many Nigerians continuing to struggle to access affordable food.

Techstars, a global startup accelerator that provides mentorship, funding, and a network of support to early-stage companies, has laid off 17% of its workforce, ending its $80 million J.P Morgan-backed AdvancingCities program by the end of 2024. The AdvaningCities initiative was launched in 2022, and was designed to support diverse founders in cities like Oakland, New York, Miami, and Washington D.C. 

In an email announced by Techstars Co-founder and CEO David Cohen, he disclosed that the startup accelerator “overbuilt and overhired”. The layoffs primarily affect teams in engineering, support services, and sales, with most of the company’s accelerator programs remaining unaffected except for those linked to J.P Morgan.

This recent layoff of workers follows a 7% reduction in headcount earlier in the year and is part of a broader shift in strategy under Cohen’s leadership, focusing less on scaling and more on improving support for founders.

It is worth noting that Techstars is currently undergoing an operational restructuring, which was publicly announced in February 2024, after it missed 2023 revenue projections and logged $7 million in losses, according to preliminary numbers seen by TechCrunch.

The primary focus of the restructuring is to position the startup accelerator for future growth and to better support its portfolio companies. Part of the restructuring includes cutting programs worldwide, laying off staff, and shuttering accelerators in cities like Oslo, Austin, and its former mothership, Boulder, Colorado.

In addition to the layoffs, Techstars is also restructuring its accelerator programs. Starting in 2024, the company will move to a two-term schedule, where most of its programs will start and end together twice a year. This change is intended to create better funding opportunities and a more concentrated Demo Day experience for participating startups, thereby increasing the success of its portfolio companies.

Key Points on Techstars Restructuring:

• Venture Capital Industry Challenges: The restructuring is being undertaken in response to broader challenges facing the venture capital industry.

• Focus on Core Strengths: Techstars is aiming to concentrate on its core strengths and areas of expertise.

Techstars restructuring process comes as the venture capital (VC) industry is undergoing a significant transformation driven by several factors, including market volatility, the rising cost of capital, and shifts in investment strategies.

With economic uncertainty and tighter financial conditions, many VC firms are becoming more selective in their investments, focusing on profitability and sustainable growth rather than rapid scaling. There has been a noticeable slowdown in funding rounds, with startups facing more scrutiny regarding their business models and paths to profitability.

Additionally, valuations have been adjusted downward, and there is an increased emphasis on due diligence. The restructuring also involves VCs diversifying their portfolios, and investing in sectors that are more resilient to economic downturns, such as climate tech, Al, and other emerging technologies.

This shift is also prompting changes in how VC firms operate internally, with some reducing their workforce or restructuring their teams to adapt to the new market dynamics. The overall goal of this restructuring is to ensure that VC firms can continue to generate returns for their investors in a more challenging economic environment.

Updated: We received this statement from a J.P. Morgan spokesperson:

In 2022, J.P. Morgan announced the $80MM Advancing Cities Fund, raised as a private placement to invest in a Techstars accelerator program focused on advancing equitable access to funding among diverse founders across the U.S. The fund is expected to be fully deployed by the end of this year, as planned. JPMorganChase remains committed to supporting founders across the country through the expansion of its diverse manager network, private investments platform and engagement capabilities.