Nigeria at 65 and Tinubunomics: Pathways to economic resurgence or looming rigmarole?

After 65 years, Nigeria appears set on a trajectory of progress, but the troubling signs of reckless borrowing and wasteful spending may pour cold water on the efforts

By Emeka Anaeto, Business Editor

At 65 many public affairs commentators believe Nigeria has come of age to show significant milestones in its match to development. But so many realities on ground indicate that so much more still needs to be done to pull the nation out of the brink, especially in the area of the economy.

BROKEN PROMISES, MISSED OPPORTUNITIES: Nigeria’s economic journey, 1960-1999

Most reports on Nigeria’s post-independence economic history have painted the picture of a bright prospect and promises which spiraled into missed opportunities and failed dreams.

The period between Nigeria’s independence in 1960 and the return to democracy in 1999 tells a complex story of negative economic transformation, from a promising agricultural powerhouse to an oil-dependent state plagued by instability.

This era, largely defined by military rule and a dramatic shift in national priorities, laid the foundation for many of the economic challenges Nigeria faces today.

What really happened, according to the reports, can be summarized in four landmark narratives as follows: Agronomics foundation laying (1960s); The oil boom and the “Dutch Disease” (1970s); The economic crisis and structural adjustment (1980s); and The stagnation and corruption (1990s).

Agricultural Foundation (1960s)

At independence, Nigeria’s economy was built and sustained on a solid agricultural foundation. Major cash crops like cocoa, groundnuts, palm oil, and rubber were the primary sources of export earnings, contributing over 75% of the country’s foreign exchange. The First National Development Plan (1962-1968) focused on investing in agriculture, industrialization, and infrastructure to fast-track economic growth. The regional structure of the country meant that each region could specialize and thrive on its unique agricultural produce, fostering a sense of economic competition and development. The industrial sector, though nascent, was growing through an import-substitution strategy.

Oil boom and “Dutch Disease” (1970s)

The discovery and subsequent explosion in global oil prices in the early 1970s completely reshaped Nigeria’s economic profile. The country went from a diverse, agrarian economy to a monolith driven by crude oil exports. By 1980, oil accounted for over 96% of total export earnings and a significant portion of the country’s GDP. This sudden wealth led to what economists call the “Dutch Disease” – a phenomenon where a resource boom causes a decline in other sectors. Agriculture was largely abandoned, and food imports surged, while the manufacturing sector, unable to compete with cheap imports, stagnated. The government’s public expenditure rose dramatically, leading to costly infrastructure projects and a growing dependence on oil revenues.

Economic crisis and structural adjustment (1980s)

The 1980s brought a harsh reality check. A collapse in global oil prices exposed the fragility of Nigeria’s oil-dependent economy. Foreign exchange earnings plummeted, external debt grew rapidly, and the manufacturing sector, which relied heavily on imported raw materials, saw a sharp decline in capacity utilization. In response, the military government of General Ibrahim Babangida introduced the Structural Adjustment Programme (SAP) in 1986, a set of reforms recommended by the International Monetary Fund (IMF) and the World Bank.

The key objectives of SAP were to diversify the economy, reduce dependence on oil and imports, and achieve fiscal stability. The policies included devaluing the naira, removing petroleum subsidies, and privatizing public enterprises. While these measures were intended to stimulate economic growth and self-reliance, they had a painful impact on the populace. Inflation soared, unemployment rose, and poverty deepened, leading to widespread social unrest.

Stagnation and corruption (1990s)

The final decade of the 20th century was largely a period of economic stagnation and political instability. A lack of consistent, long-term economic policies hindered any meaningful progress. The economic reforms of SAP were often reversed or poorly implemented, leading to policy inconsistencies and a lack of investor confidence. The country’s infrastructure continued to deteriorate, and corruption became an increasingly significant impediment to development.

By 1999, as Nigeria transitioned to civilian rule, its economy was a shadow of its potential. While it had a massive oil industry, the benefits had not translated into broad-based development. The legacy of this period was a nation with a wealth of resources but a deeply rooted set of structural problems, a weak private sector, and a reliance on a single commodity that left it vulnerable to global price fluctuations.

The last 25 years

Most of the attention is focused on eras and regimes especially in the last 25 years representing one of the greatest achievements in the match to a stable nationhood with an unbroken 25-year history of democratic governance.

In this connection some public affairs analysts would rather portray a mixed bag of development strides and challenges in the past 25 years.

But the most robust and captivating moments, according to them, are best captured in the current economic trajectories, the onset of President Bola Tinubu’s economic reform measures, the era of Tinubunomics, clearly unprecedented in the 65 years of Nigeria’s post-independent economy, and totally outdoing what all the previous regimes through the 25 years of unbroken democratic governance may have done.

Era of sweeping reforms

Nigeria’s economy has been on a rollercoaster ride over the last two and a half years, marked by bold and disruptive policy reforms. The period has seen a new administration take a radical approach to long-standing economic distortions, leading to both significant challenges and emerging opportunities.

From its first day (first hour instead) in office, mid-2023, the Tinubu government has pushed through a series of unprecedented policy changes aimed at stabilizing the economy and attracting investment.

On our top 15 list are:

Subsidy is gone!

The removal of petrol subsidies tops the list. This subsidy, fueled by widespread corruption, which had cost the government trillions of naira, was a major drain on public finances.  However, its removal led to an immediate and sharp increase in fuel prices, driving up transportation and food costs and fueling a surge in inflation.

Till date, though the retail prices of the petrol has declined significantly from the high point average of N1,200 per litre to about N865, the adverse impact on cost and standard of living for average Nigerian has remained stubbornly harsh, with the government yet to find its footing on how to ameliorate the adversity.

Foreign exchange reform

On the heels of the petrol subsidy removal came the Central Bank of Nigeria (CBN) move to unify the foreign exchange market and allow the Naira to float. This policy ended the multiple exchange rate system that had created arbitrage opportunities and foreign currency shortages as well as corruption.

While the Naira initially experienced a massive devaluation, this move has been credited with improving liquidity and attracting foreign portfolio investment.

However, though the exchange rate has moderated to N1,495 to USD1.0 as at mid-September 2025, from the high point of N1,800, the impact of the massive depreciation of the local currency brought further economic meltdown with the Gross Domestic Product (GDP) at abysmal N372.8 trillion (based on N1,530/ USD1.0 official exchange rate) at end of 2024, down from N477.4 trillion in 2022. A slight recovery has been recorded in a GDP rebase as at first quarter 2025.

Some of the adverse fallouts of the exchange rate crises was a build-up of further pressure on cost of living with more Nigerians slipping into poverty.

High interest rate regime

The CBN has also adopted an aggressive monetary policy tightening stance, repeatedly hiking interest rates to combat persistent inflation and bring it under control. With the benchmark rate at 27 percent, real lending rate and average cost of funds in the economy went up to an unprecedented mark of over 35 percent, one of the highest in the world.

Consequently, though recording three consecutive months of slight moderation, inflation has remained high despite nearly two years of implementing the anti-inflation policy, with food inflation being a particularly pressing concern due to rising costs of transportation, insecurity in food-producing regions, and a weak naira that makes imports more expensive.

While the government’s measures have shown some recent success in moderating the inflation rate, it remains a significant challenge for households.

Era of financialisation

Many analysts have debated whether the financialisation of the economy was a deliberate official policy or just another unintended outcome of the fiscal and monetary policy reforms. But what has come out clear in the past two and half years is that the financial sector has emerged predominant with the bulk of domestic and foreign capital flowing to the sector. The investors have equally reaped unprecedented returns in the sector.

The development came at the backdrop of declining or at best a sluggish growth in the real sector. Consequently, the nation’s economy is now dangerously skewed in favour of less productive sectors – financial and services sectors. But the ICT sector has also fared well.

Debt pile-up returns

Another key policy shock that marks the high point of the current regime is the borrowing spree with public debt at an all time high of N149 trillion in September 2025, up by over 200 percent from N46.2 trillion as at 2022.

Though the regime claims the purpose of the borrowing is to drive economic development with infrastructure investment, the view of independent public policy analysts is that the debt service and repayment obligation would overwhelm whatever gains the government hopes to achieve.

They argue that the high cost of debt servicing remains a major burden on the national budget.

Consequently, the combination of rising borrowings amidst the Naira devaluation may have ballooned Nigeria’s debt exposure far beyond the position it held as at 2005 when the Federal Government liquidated almost all its outstanding external indebtedness under the Paris Club Debt Relief program.

Tax reform

The government has also enacted tax reforms to streamline tax administration and increase non-oil revenue, with a focus on improving the country’s overall fiscal position.  On the surface the new tax regime, set to commence in January 2026, is expected to usher in a tax efficient economy with considerable improvement in a key macroeconomic index, the tax-to-GDP ratio.

Emergence of private petrol refinery

Dangote Refinery is a game-changer in Nigeria’s economy in general and the petroleum sector in particular. This mega-project is expected to significantly reduce Nigeria’s reliance on imported petroleum products, easing pressure on foreign exchange reserves and potentially stabilizing local energy prices in the long term. This development is seen as a major step toward energy security for the country.

The Pre-Tinubu landmarks

But before Tinubunomics, Nigeria’s 25 years of unbroken civil rule has recorded other major economic landmarks. While some represented solid grounds on which the current regime is standing, others have been swept away as unfit for purposes designed by the Tinubu regime.

The eight key policies that complete the big 15 in 25 years are as follows:

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