Is President Tinubu’s Economic Plan Sensible After All? 

Tinubu’s administration has positioned its economic policies as necessary evils, some difficult decisions that will yield long-term stability. The removal of subsidies and unification of exchange rates are aimed at correcting years of financial mismanagement and positioning Nigeria for future growth. 

However, with rising inflation, fuel costs, and public skepticism, the success of these reforms remains uncertain.

Speaking at the 30th anniversary of the Nigerian Economic Summit in Abuja, Vice President Kashim Shettima admitted that some government policies, while painful, are necessary to address the country’s pressing economic challenges.

“My heart and the heart of President Bola Tinubu go to the Nigerian people,” Shettima remarked. “We empathize with what the poor and the young are going through, but we have no option.”

While the administration’s commitment to economic reforms is clear, the question remains: Are these policies actually sensible, and will they lead to lasting improvements in Nigeria’s economic landscape?

Fiscal and Exchange Rate Reforms—A Step Towards Stability?

Before President Tinubu’s economic reforms, Nigeria was reportedly losing N10 trillion in foregone revenue annually due to fuel subsidies and multiple exchange rate policies. 

According to the World Bank, these policies placed an enormous strain on the economy, costing around N5.2 trillion in lost revenue due to the pegging of the exchange rate and another N4.5 trillion to fuel subsidies in 2022. This drain on the country’s finances was unsustainable.

The decision to remove these subsidies and unify exchange rates, though unpopular, was made to address this financial hemorrhage. The government’s position is that these changes, while difficult in the short term, will stabilize the economy in the long run. Without these reforms, the country was on the brink of collapse, with inflation, burgeoning public debt, and an over-reliance on printing money to cover fiscal gaps.

Despite these positive intentions, the immediate effect has been a sharp rise in inflation and fuel prices, with the cost of living soaring. The Nigerian National Petroleum Company (NNPC) has raised fuel prices to over N1,000 per liter in some regions, contributing to widespread public discomfort. This begs the question, can the country withstand the short-term pain to reap the long-term gains, or will the cost prove too high?

The doubts and skepticism surrounding Tinubu’s plans

Not everyone is convinced that the Tinubu administration’s economic policies will yield the desired results. Dele Momodu, a veteran journalist and prominent political figure, mentioned the government’s ability to deliver meaningful change.

Speaking on Channels Television, Momodu remarked, “I have yet to see the sign of that light at the end of the tunnel.” His concerns reflect the frustrations of many Nigerians who feel that the promised benefits of these reforms are yet to materialize.

Momodu’s critique touches on a deeper issue, public trust. Nigerians have heard countless promises of economic reform from past administrations, yet the country’s problems persist. 

Tinubu’s administration will ultimately be judged by its results, not its rhetoric. If the economy doesn’t improve soon, the current leadership may face the same criticism directed at previous administrations, including Buhari’s.

Conc

While the World Bank has praised these initiatives as essential, public opinion is divided. As Nigerians grapple with higher costs of living, the question remains: Will the pain of today lead to a more prosperous tomorrow, or is there a risk that these policies might deepen the country’s economic troubles?

Ultimately, the answer lies in the outcomes. If Tinubu’s administration can weather the storm and deliver on its promises of economic stability, history may judge these policies as sensible. If not, the reforms could be remembered as well-intentioned but insufficient to address Nigeria’s complex economic challenges.