Nigeria’s economy has been in the doldrums for years, hamstrung by an inefficient bureaucracy, policy missteps, runaway public debt, rampant corruption and crime.
President Bola Tinubu has pledged to end the malaise and double the annual economic growth rate to 6% — or more. Since succeeding Muhammadu Buhari in late May, he’s scrapped costly fuel subsidies, removed the controversial central bank governor and overhauled the nation’s exchange-rate policies, effectively devaluing the currency, the naira. Tinubu’s initial steps have enthused investors but there’s been a public backlash over rising transport costs — an early warning of the mammoth task ahead in tackling Nigeria’s myriad problems.
There’s a very long list. About 40% of the country’s more than 200 million people live in dire poverty, according to the World Bank, with half of adults un- or underemployed. Inflation climbed to an 18-year high of more than 22% in May. Corruption is endemic, many state institutions are dysfunctional, and armed bandits and Islamist militants have free rein across large swathes of the country’s north. The government spent 96% of the revenue it collected in 2022 on servicing its loans. Public debt grew seven-fold to about 77 trillion naira ($167 billion) during Buhari’s eight-year rule. Oil production — the lifeblood of the economy — is at lows last seen in the 1980s. In June, the World Bank forecast that Nigeria’s gross domestic product would only expand 2.8% this year, barely keeping pace with the increase in the population, and “far slower than needed to make significant inroads into mitigating extreme poverty.”