By Sola Adebawo
Three years into President Bola Ahmed Tinubu’s administration, Nigeria’s economic debate has become trapped between two competing narratives.
One insists the reforms have failed because fuel prices have soared, the naira has weakened, inflation has eroded purchasing power and millions of Nigerians are worse off than they were in May 2023.
The other argues the reforms are succeeding because fiscal deficits have narrowed, external reserves have strengthened, investor confidence is gradually returning and long-delayed structural distortions are finally being corrected.
Both sides marshal evidence.
Both cite data.
Both tell important truths.
Yet neither fully explains Nigeria’s present reality.
The real lesson of the past three years is not simply whether the reforms were right or wrong. It is that economic reforms rarely succeed on economic logic alone. Their success ultimately depends on institutional trust.
Citizens can endure painful reforms when they believe three conditions exist: that the sacrifice is necessary, that it is fairly shared and that it will produce measurable improvements within a reasonable period. When those conditions are absent, even economically sound reforms struggle to earn public legitimacy.
That, perhaps more than any economic indicator, explains today’s Nigeria.
The public conversation often confuses two very different ways of measuring the economy.
One measures the economy from the kitchen table.
The other measures it from the national balance sheet.
Neither perspective is wrong.
They simply answer different questions.
The kitchen table asks whether families can afford food, transportation, rent, school fees and healthcare.
The national balance sheet asks whether government finances are becoming more sustainable, whether foreign reserves are improving, whether investment is returning and whether the economy is becoming more resilient over the long term.
Confusing one for the other has produced much of today’s political disagreement.
From the perspective of ordinary Nigerians, the hardship is undeniable.
Since May 2023, petrol prices have increased several-fold following the removal of fuel subsidy. According to the National Bureau of Statistics, headline inflation climbed above 30 percent during the adjustment period, while food inflation rose even higher. Real incomes declined as wages failed to keep pace with rising prices.
These are not abstract statistics.
They determine whether parents can pay school fees, whether traders replenish inventory, whether pensioners purchase medication and whether young graduates can afford transportation to job interviews.
No serious economic analysis should minimise these realities.
At the same time, another truth deserves equal acknowledgement.
The reforms themselves were neither unexpected nor particularly controversial among economists.
For years, the International Monetary Fund, the World Bank, Nigerian economists and successive administrations argued that fuel subsidy had become fiscally unsustainable. The IMF consistently maintained that subsidy payments diverted scarce public resources from productive investment, while the World Bank repeatedly criticised Nigeria’s multiple exchange-rate regime for encouraging arbitrage, discouraging investment and weakening economic competitiveness.
The difficult question was therefore never whether reform would become necessary.
It was how reform would be implemented.
This distinction matters because good policy can still produce poor outcomes when execution is weak.
The principal debate today should no longer be whether subsidy removal or exchange-rate unification were economically justified.
The more important governance question is whether those reforms could have been implemented with better sequencing, stronger institutional coordination and more effective protection for vulnerable households.
Governments are judged not only by the quality of their policies.
They are judged by the quality of their execution.
This is where the Tinubu administration faces its greatest test.
The economic rationale behind the reforms was widely understood.
The human consequences were insufficiently anticipated.
Millions of Nigerians experienced immediate economic shock, while social protection measures arrived gradually, unevenly and, for many households, inadequately.
Economic reform may be necessary, but no society should become comfortable with citizens who work honestly yet cannot afford basic necessities. Economic efficiency without human dignity ultimately fails the moral test of governance.
Yet acknowledging these failures should not require dismissing measurable progress elsewhere.
In his 2025 Democracy Day address, President Bola Ahmed Tinubu stated that Nigeria’s fiscal deficit declined from 5.4 percent of GDP in 2023 to approximately 3.0 percent in 2024, attributing the improvement to stronger revenue mobilisation and fiscal discipline.
Independent assessments by the World Bank similarly conclude that Nigeria’s fiscal position has strengthened, while simultaneously warning that persistently high inflation continues to undermine household welfare.
The International Monetary Fund’s 2025 Article IV Consultation reported that Nigeria’s gross international reserves rose to approximately US$39.4 billion, with further improvements recorded during 2025 as external balances strengthened. The Fund also credited exchange-rate reforms and tighter monetary policy with improving macroeconomic resilience while urging the government to expand social protection.
According to the National Bureau of Statistics, Nigeria’s economy grew by 3.87 percent in 2025, led increasingly by services, finance and technology rather than oil alone. Figures published by the Nigerian Upstream Petroleum Regulatory Commission also indicate significant recovery in crude oil production following improvements in pipeline security and operational performance, while the commencement of operations at the Dangote Refinery represents one of the most significant structural changes to
Nigeria’s energy sector in decades.
These developments matter.
They strengthen the foundations of the economy.
But foundations are not finished buildings.
Macroeconomic stability does not automatically become household prosperity.
The international environment made the transition even more difficult.
The Russia-Ukraine war disrupted global energy and food markets. Post-pandemic inflation prompted central banks led by the United States Federal Reserve to raise interest rates aggressively, strengthening the US dollar and placing pressure on currencies across emerging markets. Higher borrowing costs, elevated shipping expenses and global food inflation compounded domestic pressures.
Yet external shocks alone cannot explain Nigeria’s experience.
Countries with stronger institutions, more diversified productive capacity and better social protection generally weathered those shocks more effectively.
Nigeria’s dependence on imports, weak manufacturing base, inadequate refining capacity, insecurity affecting agriculture, fragile logistics systems and years of delayed reforms magnified every global disruption.
The global economy did not create these weaknesses.
It exposed them.
This brings us back to institutional trust.
Economic reforms do not fail merely because they are painful.
They fail when citizens lose confidence that the pain is temporary, fairly distributed and competently managed.
That is ultimately a governance question, not simply an economic one.
History is therefore unlikely to judge this administration solely by whether subsidy was removed or exchange rates were unified.
Those were policy decisions.
History will judge whether those decisions restored confidence between citizens and the state.
Did inflation eventually become manageable?
Did businesses become more competitive?
Did poverty decline?
Did economic growth translate into better living standards?
Did citizens begin to trust again that sacrifice today would produce opportunity tomorrow?
Those are the questions history will remember.
Three years into the Tinubu administration, Nigeria appears to have begun correcting structural distortions that accumulated over decades.
At the same time, millions of Nigerians continue to bear a disproportionate share of the adjustment costs.
Both realities can be true.
The administration may yet be proved right on reform.
Whether it will be proved right on governance depends not on the next IMF assessment or GDP release, but on whether ordinary Nigerians eventually experience the recovery that today’s statistics promise.
Because in the end, the true currency of governance is not merely growth.
It is trust.
Sola Adebawo is an energy industry executive and strategic advisor with nearly three decades of experience across Africa’s oil and gas sector. He is the Chief Executive Officer of Hyphen Partners Limited, a specialist advisory firm focused on policy and regulatory intelligence, market entry, stakeholder strategy, and executive positioning in complex and highly regulated industries. His writing explores reform, political economy, leadership, culture, and the relationship between institutions and public life. He is an author, scholar, and ordained minister.
