Why the benefits of Tinubunomics aren’t trickling down to everyone — by Babatunde Akin-Moses

In July 2026, you might have heard that Nigeria has the best performing stock market in the world, with the equity benchmark return at 67% (in dollar terms). You might have also heard that Nigeria’s quarter one (Q1) real gross domestic product (GDP) growth was at 3.89%, ahead of the IMF’s 3.0% global growth projection for 2026. Not to mention that Nigeria’s external reserves crossed $52 billion in July, the highest in 17 years. Then there’s inflation which was around 15.91% in June 2026, and looks like half of what it was about 2 years ago – we will revisit this later. The Naira-Dollar exchange rate has also improved or has been stable, as January 2025 started with an exchange rate of N1,535 to a dollar, while it’s now around N1,370 to a dollar in 2026.

I could go on and on but you get the picture. In summary, you wouldn’t be wrong to conclude that “the economy is doing well” based on the above. But but…that’s not how you feel right? You’re paying much more for things than you were 3 years ago, which means your purchasing power has effectively reduced, because it’s not likely that your income has grown as fast. This is probably evidenced by the fact that despite the macroeconomic improvements noted above, Nigeria’s poverty rate has increased from about 56% in 2023, to 63% in 2025. Thankfully, the World Bank projects gradual decline from 2026, to about 59% by 2028. See the graph below, comparing GDP growth with poverty rate.

This article will shed some light on why this disconnect is happening, and offer some potential solutions in the process, because I’m of the view that Tinubunomics has improved the government’s financial statement more than the household’s.

I really hope this piece is welcome as a tool for education and addition to the public body of knowledge on this matter, as opposed to just political leverage. A man can dream.

3 Key Reasons Why

The 2 biggest reforms that have had the most impact on Nigerians are the fuel subsidy removal, and the floating of the naira. Technically, we could also say that the subsidy on foreign exchange (FX) was removed too. The most common answer you will hear for why these reforms have not had a noticeable positive impact on Nigerians, despite the good looking indicators, is that the transmission mechanism (to distribute the positive impact to the masses) takes time. This is 100% correct – after all, it took years, if not decades, to create (and accumulate) some of these distortions, and it wouldn’t be fair to expect them to disappear in 3 years.

There are two major reasons the gains have not reached households, and a third reason many Nigerians do not trust the evidence that conditions are improving:

1. Where the Savings are – Government versus Household Economy

When we say Nigeria’s economy is improving or stabilising, who exactly are we referring to as “Nigeria”? This is a common observation I typically use to poke fun at people sometimes. For instance, someone would say “Nigeria is terrible”, then I quickly say, “hey, since you’re a Nigerian, doesn’t that mean you’re terrible too?”. The conversation usually ends with some sort of clarification that it’s the government being referred to, or at least gets us to focus on whatever specific “terrible aspect” of Nigeria the person was referring to.

Anyway, this is one of such instances. Those reforms led to savings for the government, and not the people. Unfortunately, the government seems to have absorbed the savings in a few ways. Finance minister Taiwo Oyedele named three on 30 July: debt service, now costing as much as 24% against roughly 8% before; the wage bill, after the minimum wage went from N30,000 to N70,000; and student loans, with NELFUND now supporting 1.5 million students. He put the two subsidies at about 5% of GDP. A fourth has been acknowledged by the President himself, and that is the part that has gone to increased federal allocation for states and local governments. Ali Modu Sheriff, former Borno governor, said his state got about N150 billion across eight years while some states now collect up to N55 billion monthly – yet, there doesn’t seem to be as much demand for accountability from the states and local governments, compared to the federal level.

In short, it would appear that the savings from the two most consequential reforms have been absorbed mostly by the economies of the federal, state and local governments, but they haven’t found their way to the household economies yet.

2. The Benefits Have Gone First to Owners of Financial Assets

To be clear, some people have benefited from the reforms – perhaps too few. Given the monetary policy rate (MPR) at 26.5%, the yields on government securities have been great (16% to 18%). This has made it very profitable for banks and asset managers to make risk-free income from the government (another way the government has benefited from the reforms), while reducing lending to households and the private sector, since lending to a business has to be priced above a risk-free 17%. In fact, Nigeria recorded over $10 billion in capital importation in Q1 of 2026, a massive 84% jump from the same time in 2025. Unfortunately, over 95% of that inflow is Foreign Portfolio Investment (FPI), which is mainly investment in financial securities and so can exit at any time, as opposed to Foreign Direct Investment (FDI), which typically goes to the real economy and infrastructure.

In fairness, some FDI is on the way. The most interesting I have read about recently is the Shell Bonga South West project, which would see the oil giant investing $20 billion in total, after getting some incentives from the government. But the final investment decision won’t be made till 2027, and there is not likely to be any production till 2030 at the earliest because it is a deep water project. This ties back to the earlier point I mentioned about these things taking time.

3. There is alleged “ojoro” in how we measure inflation and growth

For my non-Nigerian readers, ojoro is Nigerian slang, from Yoruba, meaning cheating or rigging a game to favour one side. You will see why it belongs in an economic article shortly.

In the last two years, the government changed how it measures both inflation and the size of the economy. The base years moved from 2009 to 2024 for inflation, and from 2010 to 2019 for GDP. This was overdue. A shopping basket assembled in 2009 tells you very little about how a Nigerian household spends money today in 2026.

The problem was the calculation that followed. Headline inflation was 34.80% in December 2024. In January 2025, on the new basis, it was 24.48%. When I told you inflation is less than half what it was two years ago in the introduction, I was comparing an old basis number to a new one. Ten percentage points came off in a single month without a single price falling in real life. GDP for 2024 was restated at N372.8 trillion, up 34.4% from N277.5 trillion. The measured GDP became a third larger overnight, without any increase in productivity.

Both changes happened while Nigerians were in the thick of the reform shock. So many concluded the government had done ojoro. That conclusion is not unreasonable because every good macro number now has a trust issue attached to it – more on this later.

For the record, I support both exercises. They were technically correct and long overdue. What was missing was the transition. Publishing both the old and new measures side by side for a year would have let Nigerians watch the improvement happen in the measure they already knew. I understand why that was avoided though – it would have been an expensive political decision. But the cost of not doing it was paid in trust, and trust is harder to rebase.

What should happen next?

Broadly speaking there are 3 things that can be done more or better, and I have condensed this into the 3Ps: Protect, Produce and Proof.

We have to protect the most vulnerable in society. Many have said this, but there needs to be stronger social safety nets, which should be tied directly to the savings from the “two subsidy removals”. One of the ones that exist (Federal Government’s Household Prosperity and Empowerment Cash Transfer Programme – paying N75,000 per household in three tranches) has reached 9.2 million households with the first tranche but only 6.5 million with all three, against 17.9 million in the register. There’s definitely room for improvement in the quantum, and efficiency of the programme.

Nigeria needs to produce more. The government does not need to become the producer; it needs to make production easier and more attractive. That means improving electricity and infrastructure, while using credit guarantees and targeted incentives to direct private capital towards businesses and the real economy. The goal should be simple: make it more attractive for banks and investors to finance factories, businesses and jobs than to earn easy returns financing government deficits. I like how China approached this and wrote about it here.

Last but not least, Nigerians need to see the proof of where the gains from the reform are going. I was happy to hear the finance minister say that the federal government would soon publish an analysis of how the subsidy savings have been spent. I look forward to seeing similar initiatives from other tiers of government, even as we do better as citizens to hold them all more accountable.

Building Productivity and Trust

To restate an analogy I have used before, we can view an economy like a company with a financial statement. To improve profitability, we need to either increase income or reduce costs. The reforms have helped the federal government cut costs and increased revenues available to state governments. For households, however, they have significantly increased costs without a commensurate rise in income. The tax reform was a solid attempt, but it does not by itself increase productivity or income.

To improve household welfare, we need higher productivity and incomes. That means attracting more direct investment, redirecting credit towards the real economy and reducing the government’s dominance of available financing. Last but not least, there needs to be more transparency on how this is done, and how all savings are utilised. This transparency should also clearly show the cost saving efforts, and sacrifices that the government is making to move us forward, to demonstrate that it’s not just households that are being asked to be patient.

Beyond the distrust of statistics, there is also distrust in Nigeria’s leadership by its people, fuelled by years of unfulfilled promises. If that divide is to be bridged, there’s a need for Nigeria’s leaders to do the work, make the necessary sacrifices, and transparently communicate all that’s being done. Only then, can trust be gradually rebuilt.

Tinubunomics has improved the government’s finances significantly. It now needs to do the same for households.

–Akin-Moses is the CEO of Sycamore Group