Nigeria’s economic recovery is not reaching households, AERE tells Tinubu

The Alliance for Economic Research and Ethics (AERE) has urged President Bola Tinubu and the Nigeria Revenue Service (NRS) to channel Nigeria's revenue gains towards enhancing the standard of living, including reducing food prices, increasing wages, and intensifying poverty alleviation efforts. Praising the government for significant progress in revenue mobilization and macroeconomic stabilization, AERE argued that the recovery must extend beyond mere economic indicators to provide tangible benefits to households.

Recognizing the NRS and President Tinubu for tax collection increases and improvements in macroeconomic indicators, AERE emphasized that the four tax reform laws, digitized collection, and measures to eradicate tax evasion loopholes had contributed to enhanced revenue mobilization. Despite these strides, the group contended that Nigeria's debt-to-GDP ratio had decreased from 38% in 2023 to 35.5% in 2025, with projections of 32.3% by 2026, while external reserves surged from $33.22 billion at year-end 2023 to approximately $51.9 billion by July 2026.

Improvements in balance of payments, oil production, trade, capital importation, and the Nigerian Exchange market capitalization were also highlighted. However, AERE noted that these gains had not sufficiently translated into improved household welfare, citing National Bureau of Statistics data showing headline inflation at 15.91% in June 2026 and food inflation reaching 17.52%.

The World Bank's April 2026 Nigeria Development Update projected Nigeria's poverty rate to rise to 63% in 2025, affecting around 140 million people. AERE described Nigeria as experiencing a "two-speed economy" where macroeconomic improvements were not yet universally felt, emphasizing that the N70,000 minimum wage amounted to about $47-$50 a month, while studies indicated urban households required between N349,000 and N513,000 monthly to meet basic needs.

The organization stressed that the situation was more challenging given that over 90% of employment is informal, with limited protections for minimum wage. Reports indicated that Nigeria's GDP growth surged from 2.54% in Q3 2023 to 3.46% in Q4 2023, averaging 3.19% in 2024 and accelerating to 3.85% in 2025, marking the strongest annual performance within the review period.

However, the Manufacturers Association of Nigeria (MAN) reported that the Nigeria Tax Act 2025 had yet to eliminate multiple taxes and levies on manufacturers, leading to continued visits from various tax authorities and regulators, thereby undermining the anticipated relief from the tax reform. The Central Bank of Nigeria's July 2026 Business Expectations Survey revealed that 70.8% of respondents cited high and multiple taxation as the most significant obstacle to business operations, preceding insecurity and high interest rates.

In its 2026 Fiscal Transparency Report, the US Department of State found that Nigeria made no substantial progress in addressing the issues identified during the review period from January 1 to December 31, 2025. While 73 out of 140 governments, including the Palestinian Authority, met the minimum fiscal transparency requirements, 67 failed, with Nigeria among them.

This assessment occurred following concerns raised by the International Monetary Fund (IMF) over Nigeria's fiscal reporting and financial arrangements.