Market News
Nigeria reforms helped to avert economic collapse, finance minister says - REUTERS
President Bola Tinubu's economic reforms, including the removal of fuel subsidies and changes to the foreign-exchange system, have helped stabilise Nigeria's public finances, increase foreign reserves and attract investment, Finance Minister Taiwo Oyedele said.
The reforms, introduced in 2023, have received support from investors and international lenders. However, they have also contributed to significant short-term increases in living costs for many Nigerians.
Key Financial Impact
According to Oyedele:
- Fuel subsidy and foreign-exchange reforms generated approximately N15.8 trillion ($11.71 billion) in savings between June 2023 and December 2025.
- Total federal resources increased by N20.4 trillion through higher revenues and borrowing.
- The government used the additional resources to finance approximately N30.64 trillion in extra expenditure.
Additional Government Spending
| Expenditure | Amount |
|---|---|
| Wage increases | N9.39 trillion |
| External debt servicing | N9.37 trillion |
| Infrastructure | N6.50 trillion |
| Other additional spending | N5.38 trillion |
| Total | N30.64 trillion |
State Government Finances
Oyedele said the reforms helped resolve a situation in which 27 Nigerian states were struggling to pay salaries.
Foreign-Exchange Market
The reforms also significantly reduced the difference between Nigeria's official and parallel-market exchange rates.
According to Oyedele, the gap narrowed from more than 60% to below 5%.
Ways and Means Debt
The reforms also helped restrain growth in the government's approximately N30 trillion Ways and Means debt.
Ways and Means refers to direct lending by the Central Bank of Nigeria to the federal government to cover temporary budget financing shortfalls.
Economic Growth
Despite improvements in fiscal and foreign-exchange conditions, Nigeria's economic growth remains relatively subdued.
GDP expanded 3.89% year-on-year in the first quarter of 2026, compared with 4.07% in the fourth quarter of 2025.
Exchange Rate: US$1 = N1,349.84
Reporting: Camillus Eboh
Writing: Elisha Bala-Gbogbo
Editing: Barbara Lewis
