When Better Numbers Meet Emptier Pockets

The President Bola Tinubu administration has stronger reserves, slower inflation, improved revenues and a more orderly foreign exchange market to show for three years of painful reforms. Yet, for millions of Nigerians whose incomes have been overwhelmed by food, fuel and other living costs, the promised recovery remains frustratingly out of reach, writes Festus Akanbi

There is an awkward contradiction at the centre of Nigeria’s economic story. The government has increasingly persuasive data showing that some of its most controversial reforms are working. Yet many Nigerians offer an equally compelling response: if the economy is improving, why does daily survival still feel so difficult?

That gulf between macroeconomic recovery and household experience has become perhaps the greatest political and economic challenge facing President Tinubu.

The administration’s latest Reform Scorecard makes a formidable case for the decisions taken since May 2023. Finance Minister Taiwo Oyedele says the reforms generated N20.4 trillion in incremental federal resources between June 2023 and December 2025. Subsidy reforms produced N15.8 trillion in savings for the federation, of which N5.4 trillion accrued to the federal government and N10.4 trillion to states and local governments. These are hardly insignificant achievements.

The government has dismantled a petrol subsidy system it says was quietly bankrupting the country and unified a fragmented foreign exchange market notorious for arbitrage and rent-seeking. The premium between the official and parallel foreign exchange markets, according to Oyedele, has fallen from more than 60 per cent to below five per cent.

Foreign reserves provide another encouraging picture. Gross reserves have risen from about $35 billion to $52.5 billion, while net reserves increased from roughly $3 billion to $34.8 billion. Real GDP growth has strengthened from a baseline of 2.31 per cent to 3.89 per cent.

Even the states appear healthier. According to the government, 27 states could not reliably pay salaries in May 2023; today, none is in that position.

So why are Nigerians not celebrating?

The answer lies in the difference between repairing an economy and repairing household finances.

The administration itself admits that the surgery has been brutal. Petrol, which sold for about N185 per litre before the subsidy removal, subsequently climbed to between N1,100 and N1,400, according to the government’s scorecard. The Monetary Policy Rate rose from 18.5 per cent to 26.5 per cent, sharply increasing the cost of borrowing.

And although headline inflation had fallen to 15.91 per cent by June 2026 and food inflation to 17.52 per cent, declining inflation does not mean prices are returning to their old levels. It simply means they are increasing more slowly. That distinction is crucial.

A family whose food bill doubled during the inflationary shock does not suddenly recover because inflation moderates. A worker whose salary has lost much of its purchasing power due to the naira’s depreciation remains poorer unless income catches up. A small business confronted with higher electricity tariffs, transport costs, interest rates, and imported input prices cannot celebrate foreign reserve accumulation while struggling to meet payroll.

This is where the government’s persuasive spreadsheets collide with lived experience.

The hardship is particularly visible in fuel costs. Data from the NBS put the average retail price of petrol at N1,596.25 per litre in May 2026, compared with N1,027.76 a year earlier. It also cites an SBM Intelligence index indicating that the cost of preparing jollof rice has more than doubled since Tinubu assumed office.

Behind those figures are millions of household adjustments: fewer meals, cheaper proteins, postponed medical treatment, smaller accommodation and growing dependence on informal borrowing.

The experience of Grace Adama, an Abuja health-sector worker earning N135,000 monthly, captures that reality. She says her salary barely lasts one week. She has moved into cheaper accommodation, removed meat from her diet and resorted to short-term borrowing to meet bills.

No government scorecard can easily persuade such a citizen that prosperity has arrived.

Yet, dismissing the reforms altogether would be equally simplistic. Tinubu inherited genuine structural problems. Petrol subsidy imposed an enormous fiscal burden, while multiple exchange rates rewarded access and arbitrage rather than productivity. Foreign exchange shortages constrained businesses, and monetary financing had become increasingly dangerous.

Oyedele argues that without reform, Nigeria could have faced something considerably worse: a widening parallel-market premium, deeper foreign-exchange scarcity, states unable to pay salaries, and an unsustainable expansion in Ways and Means financing.

The argument has economic merit. Its political weakness is that governments are rarely judged against disasters that did not happen. Nigerians judge governments against the lives they are actually living.

That is why the administration’s counterfactual- how bad things might have become without reform- will struggle to resonate with a family spending most of its income on food and transport.

There is also the question of where the additional fiscal resources have gone.

The government says incremental federal expenditure reached N30.64 trillion. Of this, N9.39 trillion went to wage adjustments and allowances, N9.37 trillion to external debt servicing and N6.5 trillion to strategic infrastructure.

Those figures help explain another paradox. Reform may have created fiscal space without an equivalent improvement in living standards because enormous resources are being absorbed by wages, debt obligations, and infrastructure rather than by an immediate increase in disposable household income.

Social protection has also struggled to match the scale of the shock. Reports say that 9.2 million households have been enrolled in the cash-transfer system against a target of 15 million, with beneficiaries receiving at most three N25,000 transfers since 2023.

Against the cumulative increase in food, rent, transport and energy costs, the inadequacy is obvious.

The next stage of reform must therefore look fundamentally different from the first.

Macroeconomic stabilisation was necessary, but stabilisation is not prosperity. Stronger reserves must eventually support currency stability. Higher revenues must become visible in functioning hospitals, schools, roads and public transport. 

Agricultural reforms must reduce food costs. Improved investor confidence must translate into factories, businesses and jobs rather than principally financial-market gains. Credit must become affordable enough for productive enterprises to expand.

Above all, wages and household incomes must begin recovering in real terms.

The Tinubu administration may ultimately be proved right that removing the subsidy and correcting the foreign exchange regime prevented a much deeper economic crisis. Indeed, its own scorecard notably describes poverty and household welfare as “unfinished business”.

That acknowledgement may be more important than declaring victory.

For Nigerians, economic recovery is intensely personal. It is measured at the petrol station, in the market, in school fees, rent, electricity bills and what remains from a salary at the end of the month.

Until the impressive improvement in Nigeria’s macroeconomic numbers produces an equally visible improvement in those everyday realities, the administration will continue confronting its most stubborn economic paradox: the statistics may increasingly say recovery, while millions of Nigerian households are still waiting to feel it.