Life, Football, Technology and Vespas…

Artisans make, Lagosians take.

Generally, as absurd as it might sound to some, the positives of Lagos outweigh the negatives. So it is with great reluctance that I post this. People often dodge talking about some of the problems Lagos has, preferring to describe them as amusing challenges. There is one challenge that I would enjoy seeing the back of – the artificial rising of prices, just so someone can get a cut.

Saturday afternoon was spent driving from one station to the next, trying to buy diesel. At the first station we arrived at, the pump attendants would not pump diesel for us, unless we offered them a solicitation fee first. With no manager on site, there was absolutely no interest in our plight from anyone else at the station. No worries, just move on to the next station…

At the next station, we had a different problem. They had plenty of diesel in their pumps but the attendants refused to sell it to us. He informed us that we must buy diesel from the people just around the corner.  These entrepreneurs are selling diesel at the side of the street, out of black jerry cans at three times the price of the filling station’s cost – no more than 50 metres away, and by the looks of it, were doing good business. Makes no sense right? No business can be expected to survive if their competition, situated right next door, can offer the same product at only a third of the cost. Only here it can.

What has happened here is, the vendor on the side of the road has created a false market by ensuring that the station only supplies to them. The petrol station loses nothing as it is selling diesel for the price it advertises, the pump attendant gets a cut from the black market sellers, for providing the exclusivity rights and because the control of the sale of diesel is now in the hands of these dealers – the price can be whatever they want it to be.

Funny enough though, petrol was not affected as part of this wealth generation scheme – only diesel. Most cars here are petrol powered, but nearly all generators providing power to homes and offices are diesel.

This was the pattern at all the stations we went to and we eventually gave up and ended up using a colleague’s petrol car.

In the end, what happen is, the cost (unnaturally) goes up for everybody and no value has been added. The knock on effect of a 300+% increase in fuel should be obvious to most people, but it seems to be widely ignored.

Unfortunately, this is just one example of a long list of goods and services in Lagos that have their prices increased with no additional value.

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