Tinubu’s Reforms Stabilised Economy But Welfare Gains Still Lag - CPPE

The Centre for the Promotion of Private Enterprise (CPPE) has said the first three years of President Bola Tinubu’s administration succeeded in restoring macroeconomic stability after inheriting severe fiscal, monetary, and foreign exchange problems, but the benefits have not yet reached most Nigerians.

In an assessment of the government’s economic record, CPPE Chief Executive Officer Dr Muda Yusuf said Tinubu took over amid acute foreign exchange illiquidity, multiple exchange rates, falling investor confidence, and depleted external reserves. Fiscal conditions were also strained by heavy reliance on Ways and Means financing and a fuel subsidy regime that caused major leakages and distortions.

Yusuf identified fuel subsidy removal and exchange rate unification as the two core reforms driving the stabilisation agenda. He said ending the subsidy reduced pressure on public finances and created a more sustainable petroleum downstream sector, while unifying the exchange rate improved price discovery and cut arbitrage.

Both reforms, however, came with steep adjustment costs. “The immediate consequence was a significant inflationary shock. Energy prices surged, transport and logistics costs escalated, production expenses rose sharply, and naira depreciation amplified imported inflation,” Yusuf said.

The result, according to CPPE, was lower real incomes, worsening poverty, and a cost-of-living crisis. Yet Yusuf said there are signs of macroeconomic recovery. External reserves have improved and are nearing $50bn. The trade balance remains in surplus, investor confidence has strengthened, and exchange rate volatility has moderated since 2025.

The economy also recorded 11 consecutive months of disinflation from early 2025 through February 2026 before inflation pressures returned after the Iran–U.S.–Israel conflict in March 2026. The capital market gained strongly, with the Nigerian Exchange All-Share Index rising from about 55,700 points in 2023 to over 254,000 points in 2026, and market capitalisation climbing from about N30tn to more than N160tn.

Yusuf said ending Ways and Means financing improved monetary discipline, while the emergence of domestic refining led by Dangote Refinery has strengthened foreign exchange conservation and energy security. “An economy that produces more of what it consumes is inherently more resilient than one that depends excessively on imports,” he said.

Despite the gains, CPPE listed unresolved challenges: high inflation, weak purchasing power, and fragile consumer confidence. “The challenge before the administration is no longer merely economic stabilisation; it is converting reform gains into jobs, higher incomes, lower poverty, and better quality of life for Nigerians,” Yusuf said.

Insecurity remains a major threat, he added, undermining agriculture, food production, rural livelihoods, and investment. “No economy can achieve food security when farmers face persistent threats to their lives and livelihoods,” he stated.

Other constraints include high energy costs, logistics bottlenecks, policy inconsistency, weak infrastructure, and elevated interest rates, all limiting industrial competitiveness and job creation.

On fiscal sustainability, public debt rose to N159.3tn as of December 2025, driven partly by naira depreciation and the securitisation of N23tn in legacy Ways and Means liabilities. Yusuf said debt sustainability and fiscal space remain key concerns, though ongoing tax reforms could boost revenue and improve fiscal capacity.

He also stressed governance, transparency, and accountability as essential to sustaining public support. “The long-term sustainability of reforms rests on shared sacrifice. Public confidence strengthens when citizens see that adjustment costs are borne not only by households and businesses, but also by the political and governing elite,” he said.

Looking ahead, Yusuf said the next phase should focus on turning macroeconomic stability into inclusive growth through stronger investment, better productivity, improved energy and food security, greater industrial competitiveness, and poverty reduction.

“Ultimately, the success of the reform agenda will not be measured solely by reserve accumulation, exchange rate stability, or stock market performance. It will be judged by its impact on jobs, incomes, living standards, and the quality of life of ordinary Nigerians,” he said.