Osaro Okunbowa: Beyond the pain – What Nigeria’s reform numbers are beginning to show
Okunbowa For millions of Nigerians, reforms of the past three years have been experienced less as policy than as pressure. They have been felt in higher petrol prices, rising food costs, more expensive credit and a sharply adjusted naira. For businesses, the transition brought higher operating costs and pricing decisions. For households, it tested stretched […] Osaro Okunbowa: Beyond the pain –…
For millions of Nigerians, the reforms over the past three years have been felt more as financial strain than as policy changes. Higher petrol prices, increased food costs, pricier credit, and an adjusted naira have impacted both businesses and households. However, the Federal Government's Reform Scorecard indicates that certain sectors of the economy are starting to stabilize.
Central to this adjustment was the removal of the petrol subsidy and the overhaul of a fragmented foreign-exchange system, which caused financial strain and placed pressure on public finances. Between June 2023 and December 2025, the savings from eliminating the petrol subsidy amounted to ₦15.8 trillion, with ₦5.4 trillion going to the federal government and ₦10.4 trillion to state and local governments.
This fiscal shift has improved the financial situation of subnational governments, as none faced salary payment difficulties in 2026, compared to 27 states in 2023. The reforms have also provided essential cash flow for federal, state, and local governments. At the federal level, the reforms generated an additional ₦20.4 trillion in resources, including ₦5.4 trillion from the portion of the subsidy savings, ₦3.1 trillion in other revenue, and ₦11.9 trillion in borrowing.
These funds were used to adjust wages, increase minimum wages, build strategic infrastructure, and service external debt. Debt service, which was initially equivalent to 100% of revenue in 2022, is now projected to be 50% in 2026. The Ways and Means financing, which had a legacy stock of ₦30 trillion, has been reduced, and Nigeria's tax-to-GDP ratio has increased from below 10% to around 12.5%.
External reserves have strengthened, with gross foreign reserves rising from about $35 billion in May 2023 to $52.5 billion in July 2026, and net reserves increasing from around $3 billion to $34.8 billion. The gap between official and parallel foreign-exchange markets has narrowed from over 60% to less than 5%. Foreign capital flows have also increased, with total capital imports rising from $1.13 billion in Q1 2023 to $10.37 billion in Q1 2026.
Foreign direct investment has grown from $895 million in 2022 to $4.01 billion in 2025, and stock-market capitalization has expanded from ₦31 trillion to roughly ₦150 trillion by June 2026. The productive economy is also showing signs of improvement, with real GDP growth increasing from 2.31% in Q1 2023 to 3.89% in Q1 2026. Non-oil growth is projected to be around 4%, and manufacturing has expanded by 3.29%.
Despite these improvements, issues persist. Petrol remains expensive, with prices ranging from ₦1,100 to ₦1,400 per litre. Monetary policy is still tight, with the policy rate at 26.5%. Poverty and household welfare remain challenges, and while food inflation has eased from 24.82% to 17.52%, food prices are still on the rise. The reform narrative is still incomplete, and the next phase will focus on improving daily life by increasing purchasing power, creating jobs, and lowering living costs.
While the numbers suggest stabilization, the task now is to ensure that Nigerians can experience these changes in their daily lives.
Written by urgent.news from Daily Post Nigeria's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
