Nigeria’s bold economic reforms over the past two years—though painful and controversial—are now being closely reassessed as global uncertainty intensifies. Measures such as fuel subsidy removal, foreign exchange liberalisation, and tighter monetary policies initially sparked public backlash and business disruption, but they are increasingly seen as necessary steps to stabilise the economy.
At a time when rising geopolitical tensions, especially in the Middle East, are pushing up oil prices and tightening global financial conditions, many analysts believe Nigeria is better positioned than before to absorb external shocks. While inflationary pressure and cost-of-living challenges remain, the country is showing signs of improved macroeconomic stability compared to previous years of distortion-heavy policies.
A major turning point came with the unification of Nigeria’s exchange rate and the clearing of a multi-billion-dollar FX backlog. These reforms reduced arbitrage opportunities, improved transparency, and restored some investor confidence. Combined with tighter monetary discipline from the Central Bank of Nigeria, the policies have helped slow currency instability and gradually rebuild trust in the financial system.
The impact is also visible in Nigeria’s external position. Diaspora remittances, estimated at about $600 million monthly, are now providing a steady source of foreign exchange inflows, while declining sovereign risk premiums suggest improving investor sentiment. Nigeria’s return to international capital markets in 2025 further reinforced this shift, even as inflation and high borrowing costs continue to weigh on households and businesses.
Despite these gains, economists warn that risks remain significant. Food inflation, energy costs, insecurity, and infrastructure gaps continue to pressure growth and living standards. However, with stronger banking capitalisation, improved fiscal discipline, and gradual policy coordination between monetary and fiscal authorities, Nigeria is increasingly viewed as moving from economic instability toward a more resilient—but still fragile—growth path.
source: Leadership