Tinubu’s Painful Reforms Yielding Results – The Economist
Nigeria may be turning a corner after years of economic decline. According to The Economist, a spate of painful reforms introduced by President Bola Tinubu since 2023 is beginning to show positive outcomes, restoring investor confidence and stabilising key economic indicators.
When Mr Tinubu assumed office, he inherited what the magazine described as “a mess.” The central bank was saddled with $7bn in unmet obligations, foreign investors had fled, and the government was burning through $10bn annually on fuel subsidies. Inflation was spiraling, and the naira was under severe pressure.
In response, Tinubu’s administration abolished the ruinous fuel subsidy, scrapped the multi-tiered exchange-rate system, and allowed the naira to float. The central bank tightened monetary policy, while the government introduced tax incentives and improved security in the Niger Delta to revive oil production.
The reforms were initially brutal for ordinary Nigerians, with fuel and food prices soaring. Poverty deepened, and the middle class struggled to cope. Yet, nearly three years on, The Economist reports that “Tinubu’s bitter medicine is helping.” Inflation, which peaked at 34.8% in December 2024, fell sharply to 15.2% by December 2025. The IMF now projects GDP growth of 4.4% in 2026. Foreign-exchange reserves have climbed to $46bn, their highest in seven years, while the naira has stabilised after steep devaluations.
Investor sentiment is shifting. Shell recently announced plans to develop a $20bn offshore oilfield by 2027, while ExxonMobil has committed $1.5bn to deepwater projects. Local oil firms are also boosting output, aided by improved security in the Niger Delta. Non-oil exports such as cocoa and cashew nuts are becoming more competitive thanks to the weaker naira, and Tinubu’s tax reforms promise to strengthen government revenues.
Still, challenges remain. Debt service consumes around 60% of government revenues, leaving little room for investment in infrastructure, health, or education. As The Economist cautions, “It will take a long time for ordinary Nigerians, who until now have mostly borne the pain of Mr Tinubu’s reforms, to feel any benefit.” Food prices remain high, with staples like rice nearly quadrupling in cost since 2023.
Tinubu’s reforms echo those of former president Olusegun Obasanjo, whose liberalisation in the early 2000s ushered in a period of rapid growth. But while Obasanjo focused on dynamism and privatisation, Tinubu’s priority has been restoring stability. Whether this will usher in another set of “golden years” for Nigeria, as analysts suggest, depends on whether the government can translate macroeconomic gains into tangible improvements for its 230m citizens.