Tinubu reforms stabilised economy, welfare lags – CPPE

The Centre for the Promotion of Private Enterprise has said the first three years of President Bola Tinubu’s administration were largely focused on restoring macroeconomic stability after inheriting significant fiscal, monetary, and foreign exchange challenges, but noted that the benefits of the reforms have yet to translate into broad-based welfare gains. In an assessment of the administration’s economic performance, the Chief Executive Officer of the CPPE, Dr Muda Yusuf, said the government assumed office amid acute foreign exchange illiquidity, multiple exchange rates, declining investor confidence, and weakened external reserves. According to him, fiscal conditions were also strained by entrenched Ways and Means financing and a fuel subsidy regime that had become a major source of fiscal leakages and economic distortions. Yusuf identified fuel subsidy removal and exchange rate unification as the two major reforms underpinning the administration’s economic stabilisation agenda. He said the subsidy removal reduced pressure on public finances and created the basis for a more sustainable downstream petroleum sector, while exchange rate unification improved price discovery in the foreign exchange market and reduced arbitrage opportunities. However, he noted that both reforms came with significant adjustment costs. “The immediate consequence of the reforms was a significant inflationary shock. Energy prices surged, transportation and logistics costs escalated, production expenses increased sharply, and the depreciation of the naira amplified imported inflation pressures,” Yusuf said. According to him, the reforms contributed to declining real incomes, worsening poverty conditions, and a cost-of-living crisis. Despite the challenges, Yusuf said there was evidence of macroeconomic recovery. He stated that external reserves had improved significantly, gross reserves were approaching $50bn, the balance of trade remained in surplus, investor confidence had strengthened, and exchange rate volatility had moderated since 2025. The CPPE chief added that the economy recorded 11 consecutive months of disinflation from early 2025 through February 2026 before inflationary pressures resurfaced following the Iran–U.S.–Israel conflict in March 2026. He also pointed to gains in the capital market, noting that the Nigerian Exchange All-Share Index rose from about 55,700 points in 2023 to more than 254,000 points in 2026, while market capitalisation increased from about N30tn to over N160tn. Yusuf said the discontinuation of Ways and Means financing had improved monetary dis