Nigerians may have to wait more than a decade before they begin to fully feel the benefits of President Bola Tinubu’s economic reforms, economists have warned, with some estimating that the process could take between 12 and 20 years. While the reforms are expected to improve productivity and real incomes over time, experts say they are unlikely to bring immediate relief to households already struggling with high food prices, rising living costs and reduced purchasing power.
The Tinubu administration introduced major economic changes after taking office in May 2023, including the removal of petrol subsidies, foreign exchange market reforms, electricity tariff increases and tax reforms. According to Dr. Paul Alaje, Chief Economist and Partner at SPM Professionals, structural reforms typically require 12 to 20 years before their impact becomes significantly visible, although some countries have recorded meaningful results within six to 10 years. He explained that the expected gains would come largely through increased productivity and higher real incomes rather than an overnight fall in prices or exchange rates.
Other economists stressed that the reforms could become more painful if the government fails to address the structural problems holding businesses and households back. Dr. Felix Echekoba of Nnamdi Azikiwe University said successful economic restructuring often comes with short-term sacrifices, but the adjustment period must not be allowed to drag on unnecessarily. Development economist Professor Tayo Bello of Adeleke University similarly noted that subsidy removal and exchange-rate reforms have historically created temporary economic distress, adding that policy stability, infrastructure and investment would determine whether Nigeria eventually achieves meaningful gains.
For many Nigerians, however, the promised long-term benefits remain difficult to see amid the immediate pressure on household budgets. Alaje pointed to high interest rates, weak infrastructure and institutional challenges as major obstacles, noting that businesses are still facing borrowing costs of about 30 to 40 per cent. He also warned that millions of poorer Nigerians could carry much of the burden during the adjustment period if stronger social protection measures are not implemented. The economists stressed that reforms alone cannot transform living standards without significant investment in roads, electricity, rail, manufacturing, agriculture, education and technology.
Experiences from countries such as India, Ghana, Indonesia and Egypt show that major economic reforms can take several years before their broader benefits become visible. India’s 1991 liberalisation helped restore stability relatively quickly, but wider gains emerged over the following decade, while Egypt experienced a sharp inflationary shock after its 2016 currency flotation before recording stronger macroeconomic outcomes later. For Nigeria, economists say the key test will be whether the government can convert savings from policies such as the petrol subsidy removal—which previously cost the Federal Government about N3.36 trillion annually—into productive investments that create jobs, raise incomes and reduce the pressure on ordinary Nigerians.
source: nairametrics
