What Must Nigeria Fix to Sustain Economic Recovery

Nigeria may be seeing early green shoots, but a durable recovery won’t come from sentiment alone. It will require fixing the structural bottlenecks that turn macro gains into cheaper food, stable transport fares, and real jobs.

Here’s where the work is most urgent, and what success would look like.

1) Power: from emergency fixes to bankable reliability

Unstable electricity is a tax on every business. Nigeria needs a practical power agenda: unlock gas-to-power (clear legacy debts to gas suppliers and firm up take-or-pay contracts), accelerate metering to cut losses, and invest in transmission “last-mile” capacity so generated power actually reaches customers.

A credible loss-reduction plan for DisCos, targeted mini-grids for industrial clusters, and time-of-day tariffs for large users can quickly lower generator dependence and production costs.

ATC&C loss reduction at DisCos, new gas supply agreements honoured, transmission wheeling capacity added, and hours of supply for SMEs are rising quarter-on-quarter.

2) FX stability: rules, liquidity, and exports

A steadier naira depends on predictable FX market rules and more dollar supply. Priorities include a clear CBN intervention framework, transparent auction calendars, timely settlement, and firm enforcement of export-proceeds repatriation.

On the supply side, grow non-oil exports (agro-processing, solid minerals with traceability, creative and tech services) and de-risk diaspora inflows with reliable channels and attractive instruments.

Bid–ask spreads are narrowing, forward backlog clearance is improving, export proceeds are returning within stipulated windows, and rising autonomous market liquidity.

3) Fiscal discipline: spend better, tax smarter

Recovery falters if deficits crowd out private credit. Nigeria should prioritise: a medium-term fiscal framework that caps recurrent growth, re-orders capital spending toward high-multiplier projects, and tightens procurement.

On revenue, harmonise taxes, digitise collection, and widen the base, primarily through the formalisation of SMEs, while eliminating nuisance levies that fuel informality.

Non-oil revenue growth, capital spending execution rates, lower interest costs as a share of revenue, and fewer layers of multiple taxation across states and LGs.

4) Logistics and ports: cut delays, cut prices

Food and consumer prices are heavily driven by transport and storage costs. Fixing the ports can move inflation. Implement a true single-window system, modern scanners, 24/7 terminal operations, and stricter service-level timelines.

Beyond ports, prioritise key road corridors, expand rail for bulk freight, and invest in cold-chain infrastructure to reduce post-harvest losses.

Truck dwell time at Apapa/Tin Can, average clearance times, freight costs on major corridors, and measured post-harvest loss reductions.

5) Food systems: productivity over palliatives

Sustained disinflation requires more supply. Scale proven interventions, irrigation in key belts, quality seeds and input credit tied to offtake agreements, index-based crop insurance, and community-led security for farm corridors. Support processing zones so outputs move up the value chain, earning FX and stabilising local prices.

Hectares under irrigation, input redemption rates, processor capacity utilisation, and farm-to-market security incidents trending down.

6) Capital for real economy: unlock credit and equity

SMEs need working capital at reasonable rates. Expand risk-sharing facilities, deepen movable collateral registries, and grow credit scoring coverage.

On the equity side, catalyse pension-fund participation in infrastructure and growth equity via clear prudential rules and de-risked vehicles.

MSME loan growth, average lending rates for priority sectors, NPLs contained, and local institutional capital commitments to infrastructure and PE/VC.

7) Policy coordination and data transparency

Markets reward consistency. Regular joint briefings by Finance, Budget, Trade, Power, and the CBN, anchored on published targets, reduce rumour premiums.

Better, faster data (energy, FX, inflation micro-breakdowns, fiscal outturns) helps businesses plan and investors commit capital.

Predictable policy calendars, timely publication of fiscal/FX/power data, and fewer ad-hoc directives.

8) Protecting households: keep reform legitimacy

Reforms bite before they bless. Targeted cash transfers, transport vouchers for urban poor, school feeding in vulnerable areas, and micro-grants for nano-businesses help maintain social license while supply-side fixes take hold.

Coverage and timeliness of transfers, independent audits of beneficiary lists, and poverty/food-security indicators stabilising.