In the corridors of power and on the streets of Lagos, there is a familiar refrain: “It didn’t start with Tinubu.” This is undeniably true. Nigeria’s economic crisis is not the sudden onset of a new illness but the painful culmination of decades of untreated ailments. The nation, Africa’s largest economy by nominal GDP, finds itself in a profound reckoning, grappling with the consequences of successive administrations that, for various reasons, shied away from or botched the necessary, often painful, reforms.
But to merely acknowledge this historical trajectory is to describe the weather. The real questions facing Nigeria today are more urgent: Are we now charting a different course, or merely prolonging the storm? Can the current administration’s bold but painful reforms succeed where others have failed? And most critically, can Nigeria afford to continue the old ways?
This analysis aims not to whitewash history or demonise any administration, but to honestly assess the rot, recognise the reforms, and highlight the risks of a rebound stalling under the weight of inconsistency, opacity, and fragile confidence.
The anatomy of decay: A four-decade descent
The structural rupture of the 1980s
The descent began with the Structural Adjustment Programme (SAP) of the late 1980s. Championed under General Ibrahim Babangida, it was framed as a necessary shock to rebalance Nigeria’s finances. Instead of structural transformation, however, we witnessed economic dislocation: sharp devaluation of the naira, soaring inflation, public sector retrenchment, and a weakened industrial base. The ensuing withdrawal of government support for critical sectors crippled local industries and ignited a rapid spread of poverty.
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The Abacha years: Plunder and paralysis
Under General Sani Abacha, the rot deepened into systematic decay. Oil prices were low, infrastructure collapsed, and capital flight accelerated. The economy was strangled by corruption, mismanagement, and the collapse of oil refineries. Refineries deteriorated, pipeline vandalism surged, and billions were looted and stashed abroad. Corruption evolved from a whisper to a norm, and Nigeria lost not only money but also time—precious years of potential growth.
Civilian rule returns: Promise and paradox
President Olusegun Obasanjo’s tenure brought flickering hope—telecom liberalisation, debt relief, and a vibrant banking sector. Yet these gains were overshadowed by persistent contradictions. The privatisation program was poorly executed, creating a rentier elite rather than a productive private sector. Public assets were sold to politically connected individuals, often leading to asset stripping rather than revitalisation. The power sector reforms failed spectacularly, leaving Nigeria with less than 4,000 MW for over 200 million people. The economy expanded, but inequality widened. Jobless growth became the national reality.
“The treasury was effectively empty, with Nigeria spending ₦10 trillion annually on fuel subsidies that generated no productive output. Debt servicing consumed over 90 percent of revenue, while multiple exchange rates created a breeding ground for corruption and arbitrage.”
The Yar’Adua interregnum and Jonathan’s mirage
President Umaru Yar’Adua’s efforts were curtailed by illness, and despite billions budgeted for Turn Around Maintenance (TAM), the refineries remained dysfunctional. Under Goodluck Jonathan, GDP rebasing in 2013 made Nigeria Africa’s largest economy on paper, but the growth was fragile and largely without impact—the average Nigerian remained poor. When oil prices crashed in 2014, fiscal buffers evaporated. The fuel subsidy regime metastasised into a national scam, the Excess Crude Account was depleted, and structural transformation never materialised. It was a mirage, not a model.
Buhari’s legacy: Macro instability and missed opportunity
President Muhammadu Buhari inherited a stressed economy—and compounded it with policy inertia. His administration largely maintained the status quo on critical reforms, adhering to multiple exchange rates that created fertile ground for arbitrage and manipulation. Instead of bold reforms, his government pursued populist but unsustainable subsidies and an overreliance on the CBN’s financing tools. Two recessions, mounting debt, and soaring inflation weakened fundamentals. By the time President Buhari left office in 2023, the economy was in critical condition: public debt had ballooned from ₦12 trillion to ₦77 trillion, inflation was rampant, unemployment spiralled, and over 130 million Nigerians were mired in multidimensional poverty. The naira’s value plummeted, all refineries ceased operations, and Nigeria was spending over ₦10 trillion annually on fuel subsidies while importing every drop of fuel. The nation was effectively borrowing to pay salaries and subsidies—economic intensive care by any measure.
Tinubu’s inheritance: A broken economy
President Bola Ahmed Tinubu assumed office in May 2023, facing an economy on life support. The treasury was effectively empty, with Nigeria spending ₦10 trillion annually on fuel subsidies that generated no productive output. Debt servicing consumed over 90 percent of revenue, while multiple exchange rates created a breeding ground for corruption and arbitrage. The nation’s infrastructure was collapsing, with no functional refineries, an erratic power supply, and oil production declining to just 900,000 barrels per day. Over 130 million Nigerians were trapped in multidimensional poverty, and investor confidence had reached historic lows, with widespread capital flight continuing unabated. Faced with this economic quagmire, Tinubu had two choices: continue the deception of maintaining subsidies, multiple exchange rates, and unsustainable borrowing—delaying the inevitable collapse—or take the hard road of implementing painful but necessary reforms to reset the economy. He chose the latter.
The Tinubu reforms: Bold steps, risky execution
The necessary measures
The most courageous decision was removing the fuel subsidy—a fiscal time bomb that previous governments had consistently avoided. This regime was draining over ₦11 trillion annually with no productive output, benefiting smugglers and fraudsters while impoverishing the nation. Simultaneously, the Central Bank of Nigeria collapsed multiple exchange rates into a single market-driven system, eliminating arbitrage windows that had drained foreign exchange reserves and enriched a select few through manipulation. The administration also launched comprehensive revenue mobilisation efforts, including tax reforms, customs digitisation, and improved FIRS collections, with tax revenue showing marked improvement. Finally, the CBN tightened liquidity and began dismantling its developmental finance overreach, restoring focus to core monetary policy functions.
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Early signs of progress
The reforms are beginning to show results across multiple fronts. Oil production has recovered dramatically from 900,000 barrels per day in 2023 to over 1.5 million barrels per day in 2025, signalling improved security and operational efficiency. The naira has stabilised significantly, appreciating from ₦1,900 to the dollar to ₦1,200 in the second quarter of 2025. International confidence is returning, with the World Bank, IMF, and foreign investors re-engaging with Nigeria after years of scepticism. Month-on-month inflation is declining from its peak, suggesting that the worst of the price surge may be behind us. Additionally, infrastructure investment is gaining momentum, with the Dangote Refinery and other modular refineries beginning to reduce the nation’s import dependency.
The painful reality
However, the immediate aftermath has been brutal for ordinary Nigerians. Fuel prices escalated dramatically, food prices surged, and transportation costs climbed sharply, creating a cascade of economic hardship. Four million Nigerians reportedly fell into poverty in the first half of 2023 alone, while food inflation has been hovering above 20 percent, with over 130 million facing food insecurity. Youth unemployment is estimated to exceed 50 percent, creating a generation of frustrated young people with limited economic prospects.
The danger of the “No Alternative” doctrine
There is a growing narrative that since Tinubu inherited a broken economy, any criticism of his administration is unjust. This is both dangerous and defeatist. The fact that bold steps have been taken does not absolve the administration from scrutiny. Nigeria cannot afford another cycle of reforms without results.
“The most courageous decision was removing the fuel subsidy—a fiscal time bomb that previous governments had consistently avoided.”
Critical concerns
The debt trajectory remains a significant concern. While the government asserts it is “doing more repayments,” data indicates Nigeria’s total public debt has surged from ₦87 trillion in June 2023 to over ₦183 trillion by December 2024. President Tinubu’s government has reportedly borrowed approximately ₦96 trillion in two years, including substantial loans from multilateral institutions. This rapid accumulation raises questions about fiscal sustainability and the long-term burden on future generations.
Transparency remains a critical deficit. Where is the purported ₦11 trillion saved from subsidy removal going? The government must publish monthly reports on subsidy savings deployment to build citizen trust. The savings narrative is misleading when the government grapples with enormous accumulated debts from past subsidy payments, making it unclear whether these are genuine savings or merely debt restructuring.
The policy-result lag is another pressing issue. While policies might be economically sound, the perceived actions of some within the government, particularly regarding expenditures and pricing templates, appear to be elongating the period of public pain. The lack of “unity of command” among political office holders erodes public trust and undermines the reform narrative. Subnational accountability presents an additional challenge. FAAC allocations have surged by over 200 percent in two years, yet across the states, poverty and infrastructure deficits persist. The question remains: what have governors done with their windfall, and how can they be held accountable for improved service delivery?
The fragile window of opportunity
Nigeria stands at a crossroads. The economic collapse of the past was gradual, but the policy pivot of today is abrupt. This creates a pain window that must not be wasted. To convert short-term pain into long-term gain, the administration must address several critical imperatives:
Immediate actions required
The administration must strengthen fiscal discipline by tackling expenditure inefficiency, especially in procurement. Nigerians cannot be expected to sacrifice while government convoys expand and wasteful budget lines remain untouched. Enhanced transparency is equally critical, with monthly reporting on subsidy savings deployment being essential. The government must demonstrate that the pain is yielding productive investment, not elite enrichment. Accelerating infrastructure investment is paramount. Power, roads, agriculture, and education must receive real investment—not just budgetary mention. The ₦11 trillion in subsidy savings must be channelled into growth-driving infrastructure that creates jobs and improves living standards. Simultaneously, the administration must tighten debt management, as the current borrowing trajectory is unsustainable. The government must prioritise domestic resource mobilisation and restructure current liabilities to avoid a debt crisis.
Addressing the policy-result lag requires eliminating bureaucratic sabotage, empowering MDAs to implement reforms quickly, and signalling results early to sustain public buy-in. The administration must also inspire subnational reform, holding states accountable for service delivery through peer review mechanisms, scorecards, and incentives, especially given their increased FAAC allocations.
The verdict: Necessary but perilous
The current administration is making the hard choices that previous leaders avoided. The pain is real, and the burden is disproportionately borne by the poor. The question is not whether Tinubu’s reforms are painful—it is whether Nigeria can afford to continue the old ways. The answer is emphatically no. Economic transformations do not happen overnight. The United States needed years to recover from the 2008 financial crisis. Germany’s post-war economic miracle took decades. Nigeria’s situation is no different, but the timeline for showing results is compressed by the severity of public suffering.
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The only way the current sacrifice becomes meaningful is if it leads to shared prosperity, not elite enrichment. Reform without results breeds resentment, and resentment, if unchecked, will lead to reversal. The administration must recognise that credibility, not courage alone, will determine the legacy of this moment.
Conclusion: The road ahead is narrow but necessary
Nigeria has left Egypt, but the journey through the wilderness is proving more arduous than many anticipated. The challenge for the Tinubu administration is to ensure that the “hard road” leads unequivocally to a destination of shared prosperity, not just a prolonged period of hardship. The nation must stay the course while demanding accountability and tangible improvements. The current pain is the price of confronting decades of economic deception. If Nigeria maintains unwavering resolve with genuine commitment to equitable implementation, the suffering may indeed pass, and the progress, however slow, will endure.
But unless we make the promised land visible, through growth, jobs, and justice, many may start longing for Pharaoh again. The window for transformation is narrow, and the margin for error is thin. Nigeria’s economic reckoning demands nothing less than the complete reimagining of how the nation generates, distributes, and utilises its wealth. The alternative to reform is not the status quo; it is economic ruin. Nigeria cannot afford to fail again.
Dr. Oluyemi Adeosun, Chief Economist, BusinessDay Media
