Tanimu Yakubu: Widespread Poverty, Hardship Can’t Be Blamed on Tinubu’s Economic Reforms

• Says reforms are addressing structural weaknesses

• Insists inherited poverty is not a product of Tinubu’s reforms

James Emejo in Abuja

The Director-General of the Budget Office of the Federation (BoF), Mr Tanimu Yakubu, yesterday said the widespread poverty and hardship confronting Nigerians could not be attributed to the economic reforms introduced by the administration of President Bola Tinubu.

Yakubu said Nigeria entered the reform period burdened by deep-rooted economic weaknesses, including low productivity, foreign exchange distortions, fiscal leakages, unreliable power supply, insecurity, poor infrastructure and weak job creation, stressing that the persistence of these problems should not automatically be blamed on the reforms.

In a statement titled, “Poverty, Reform and the Problem of Causation,” Yakubu said the central issue was to distinguish between the conditions that produced Nigeria’s poverty crisis and the policies currently being deployed to address them.

He spoke against the backdrop of a report citing World Bank data suggesting that a large proportion of Nigerians were either living below the poverty line or vulnerable to falling into poverty.

Yakubu cautioned against interpreting the figure as a conventional poverty headcount, explaining that the World Bank’s assessment also included people who were above the poverty line but remained vulnerable to economic shocks.

He said the distinction did not diminish the severity of the social crisis but was necessary for a proper assessment of the country’s economic condition.

“The pain is real; the conclusion does not follow automatically,” he said, adding that the persistence of poverty nearly three years into the reform programme did not establish that the reforms had caused the hardship.

According to him, Nigeria did not enter the reform period as a healthy economy that was suddenly destabilised by policy changes.

Rather, he said, the country had accumulated years of structural weaknesses, including weak per capita growth, low productivity, insecurity in food-producing areas, unreliable electricity supply, poor logistics, limited formal employment, foreign exchange scarcity, multiple exchange rates and inflationary financing.

He also identified the former fuel subsidy regime and fiscal leakages among the distortions that had placed increasing pressure on public finances.

Yakubu maintained that the poverty crisis predated the reforms and should, therefore, be assessed against the economic conditions inherited by the administration in 2023.

The Director-General pointed to improvements in key macroeconomic indicators as evidence that the reform programme had begun to address some of the structural problems.

He cited World Bank data showing that Nigeria recorded real Gross Domestic Product (GDP) growth of four per cent in 2025, while the International Monetary Fund (IMF) also estimated growth at four per cent in 2025 and projected 4.1 per cent for 2026.

Gross international reserves, he added, rose to about $46 billion at the end of 2025 from approximately $40 billion a year earlier, while net international reserves increased from $23 billion to $35 billion.

Yakubu stressed that such improvements could not simply be dismissed because households were still struggling with the high cost of living.

He said macroeconomic stabilisation alone was, however, insufficient, stressing that the government must ensure that improved economic stability translated into higher productivity, increased investment, employment and household incomes.

“Stabilising the economy is not enough; government must make that stability useful to ordinary people,” he said.

He also rejected the interpretation that the decline in Nigeria’s GDP measured in US dollars necessarily represented a corresponding contraction in the volume of economic activity.

According to him, the depreciation of the naira significantly affected the dollar conversion of Nigeria’s output, making current-dollar GDP an inappropriate standalone measure for determining whether domestic production had expanded or contracted.

He said real GDP, productivity, employment, sectoral output and real household consumption were more appropriate indicators for assessing changes in domestic economic activity.

Yakubu acknowledged that the depreciation of the naira had inflicted real welfare losses by reducing the foreign currency value of wages, savings and assets, while increasing the naira cost of imported goods.

He maintained, however, that such effects should not be confused with a collapse in real production.

While defending the direction of the reforms, Yakubu acknowledged that Nigerians had continued to bear significant adjustment costs.

He said the removal of fuel subsidies and foreign exchange reforms could immediately raise prices and weaken household purchasing power, while the benefits of improved public finances and a more stable economy could take longer to materialise.

According to him, the country had not been choosing between reform and an easy economic path, but between confronting accumulated distortions and allowing them to deepen until a future correction became even more painful.

He challenged the government to ensure that macroeconomic gains ultimately translated into tangible improvements in living standards.

According to him, electricity must become more reliable and affordable for businesses, infrastructure must facilitate the movement of goods, security must enable farmers to return to their farms, while schools, healthcare and social protection must provide greater support to vulnerable households.

“Poverty is one of the strongest reasons reforms must succeed; it is not proof that reform was wrong,” he said.

Yakubu warned that the government should not use improved macroeconomic indicators as an excuse for complacency.

He noted that four per cent growth represented an improvement but remained insufficient to rapidly transform living standards in a country with a fast-growing population.

He stated: “Strong reserves do not feed a family. A smaller deficit does not raise a worker’s pay. Higher government revenue improves welfare only when it becomes reliable power, roads, schools, hospitals, security, productive investment and effective support for people in distress.”

He said the government should, therefore, be judged on whether the reforms were attracting new investment, raising productivity, creating better jobs, improving real wages and protecting vulnerable Nigerians.

Yakubu maintained that if those outcomes failed to materialise over time, criticism of the reform programme would be justified.

He cautioned against treating inherited poverty as though it began with the reforms, insisting that such an approach would obscure the actual causes of Nigeria’s economic difficulties and could encourage a return to policies that had contributed to foreign exchange shortages, fiscal pressures and economic instability.

He said the ultimate test of the reforms was whether improved macroeconomic stability could be converted into greater production, increased private investment, quality jobs, lower inflation, stronger public services and rising household incomes.

According to him, “Nigeria’s real choice now is not whether to recreate the policies that produced foreign exchange shortages, fiscal leakage and instability. It is whether the country can turn greater economic stability into more production, more private investment, better jobs, lower inflation, better public services and rising incomes.”