Why Nigerians despise Tinubu’s economy

President Bola Ahmed Tinubu's economic reforms have sparked widespread criticism among Nigerians, with concerns over rising living costs, inflation, poverty and the social impacts of policies introduced since he took office. In a surprising move, Tinubu even abolished the highly controversial fuel subsidy during his inauguration speech, causing significant hardship for Nigerians.

Subsequently, the administration introduced the unification of the foreign exchange market, along with tax and fiscal policy changes, banking sector recapitalisation and monetary policy tightening. The administration's reforms have received mixed reviews from economists and businesses, but Nigerians remain sharply divided over the government's direction and impact.

While supporters argue that Tinubu has tackled economic issues that previous administrations failed to address and taken steps to stabilise public finances and increase revenue, critics contend that the reforms have imposed severe costs on households and businesses without providing adequate social protection. Economists and business analysts who spoke on the reforms said that while some policies may be necessary, their speed, sequencing and the absence of measures to cushion their impact on Nigerians have been questioned.

Some economists have pointed out that the exchange rate reforms have increased the local currency cost of imports and foreign obligations, exacerbating the inflationary impact and aggravating poverty. Dr Sam Amadi, a former Chairman of the Nigerian Electricity Regulatory Commission and Director of Abuja School of Social and Political Thoughts, expressed concerns about the reforms' negative impact on human capital development and sustainable economic growth.

He noted that the subsidy removal had reduced Nigeria's economic growth potential, while SMEs were struggling and the energy crisis was affecting businesses.

Amadi also highlighted that Nigeria now has a lower GDP per capita compared to 2023. The removal of the fuel subsidy and the floating of the naira were criticized as lacking adequate structural cash transfers to vulnerable communities. Food imports were also a concern, with lower food prices potentially benefiting consumers but hurting agricultural producers when domestic prices fall sharply.

Auto entrepreneur Bassey Esu-Duke observed that only a few wealthy individuals are benefiting from the reforms, while low- and middle-income earners are struggling to afford basic needs.

Civil society organisations and labour groups have strongly criticized Tinubu's economic reforms, stating that they have led to severe hardship, a high cost of living and rising poverty levels. A coalition of civil organisations has argued that while the reforms have increased government revenue, they have not translated into improved living conditions for citizens.

The contrasting views highlight the central debate around Tinubu's economic policies: whether the long-term gains from the reforms will outweigh the immediate hardships faced by households and businesses.