FG considers law to prevent reversal of economic reforms

The Nigerian government is contemplating legislation to safeguard the nation's economic reforms from being reversed by future administrations. This move aims to establish policy consistency and prevent the return to practices deemed detrimental to the economy. During the 32nd Nigerian Economic Summit in Abuja, Finance Minister Taiwo Oyedele revealed the government's efforts to create a binding economic policy framework, which will be backed by law and serve as guiding principles for future decisions.

Oyedele emphasized the importance of locking in this framework within institutions, laws, and policy, ensuring its long-term viability. The proposal aims to prevent future administrations from abandoning reforms for short-term political gains, particularly in areas such as petrol subsidy removal. He stated that any attempts to revert to these policies should be disregarded, and the framework would be incorporated into the screening process for government appointments.

The framework, currently a consultation draft, proposes mandatory Policy Impact Assessments for major economic interventions. These assessments will require regulators to evaluate the evidence, costs, beneficiaries, and expected duration of proposed measures. Additionally, the government plans to publish an annual National Economic Scorecard, measuring changes in real wages, productive employment, and poverty levels on Independence Day.

Oyedele criticized Nigeria's history of inconsistent economic policies, highlighting how successive governments have undermined earlier reforms. He advocated for political parties to focus on explaining how they would implement a nationally agreed economic policy rather than producing competing manifestos. The minister also questioned Nigeria's industrial protection policies, revealing that domestically assembled vehicles contained only about five percent local content, despite enjoying tariff and levy protection of up to 60 percent.

The government aims to achieve low single-digit inflation by the end of 2027 and cheaper borrowing rates, although a definite timeline for this goal was not provided. The Ministry of Budget and Economic Planning, led by Abubakar Bagudu, reiterated the government's commitment to sustaining economic reforms, despite concerns about their immediate impact on households.