The year of extremities, 2025, dovetailed into the new year, 2026, with glints of the nation’s macroeconomic indicators showing modest improvements. The International Monetary Fund(IMF) forecasts Nigeria’s GDP growth at 4.2% for 2026, a steady rise from 3.9 per cent in 2025, positioning the nation as Africa’s third-largest economy with a nominal GDP of around $334 billion.
Similarly, Fitch Ratings assessment projects a close 4.3 per cent GDP growth rate for 2026. This is backed by a rebounding domestic demand, easing inflation, and slight oil production gains to 1.73 million barrels per day.
The naira has also stabilised in the N1,440-N1,500/$ band, bolstering business confidence, according to financial analysts, while foreign exchange reserves hit a five-year high of $45.24 billion by late 2025, projected to range $40-55 billion in 2026, offering nearly 11 months of import cover.
However, there is a glaring dissonance between these macroeconomic indicators on paper and the realities on ground. In essence, the modest gains from the Tinubu administration’s tough economic reforms have not translated into concrete relief for the average Nigerian who is still helmed in the stranglehold of poverty and misery.
This is the crux of the matter. So, the first priority task before President Bola Tinubu and his economic team, in the new year, is to work assiduously to synchronize the gains accruing from the reforms and their physical impact on the people’s standard of living.
The 2025 World Bank report paints a grim picture of a glaring disconnect between the modest gains accruing from these reforms and the worsening poverty among the people as well as the struggle to translate those gains into improving the people’s living conditions.
The latest global bank’s report indicated that an estimated 139 million Nigerians(about 45-46%) still live in poverty, an astronomical spike from 87million in 2018.
The Country Director of World Bank, Mathew Verghis, acknowledged at the launch of the October 2025 Nigeria Development Update in Abuja, that the Federal Government’s policy reforms, including monetary tightening, subsidy removal, and exchange rate unification, have produced some stabilisation gains.
But he noted that in spite of these stabilisation gains, many households are still struggling with a seriously plummeted purchasing power. According to the global bank’s report, poverty, which began to rise in 2018 due to policy missteps and external shocks such as COVID-19, has continued to increase, even after the current administration’s reforms.
Inflation has eased sharply from 24.48 per cent in January 2025 to 14.45 per cent by November, according to the latest report of the National Bureau of Statistics(NBS), owing to naira stability and improved supply chains, but that has not dramatically brought down the high costs of living as expected.
On a month-on-month basis, NBS said, headline inflation stood at 1.22 per cent in November,2024, higher than the 0.93 per cent recorded in the previous month, indicating that average prices still increased at a faster pace during the month despite the moderation in annual inflation.
The World Bank report, in essence, mirrors the daily experiences of millions of Nigerian households grappling with soaring food prices, stagnant incomes, and eroded purchasing power.
The global bank’s assessment underscores a contradiction that has haunted Nigeria’s economic trajectory for decades, which is the disconnect between policy success on paper and lived realities on the ground.
Experts situate the problem partly within some fiscal policy missteps such as unbridled borrowing, which keeps debt levels rising and budget failures. While the buffs advise that the government should learn from the past budget failures in implementing the 2026 budget, they warn that the former(reckless borrowing) poses significant risks, with service obligations exceeding N15 trillion in the 2026 N58.18 trillion budget or about 50 per cent of the projected revenue.
This, according to them, constrains the fiscal space after oil revenue shortfalls, with actual prices hovering at $66 per barrel for 2025, compared with the $75 budgeted. Oil production remained muted at an average of 1.66 barrels per day, which is much lower than the 2.06 million bpd estimate.
So, to mitigate these blights, experts recommend that the government should pull all the stops and take adequate measures towards the reduction of inflation, particularly food inflation.
Boosting local food production, investing in mechanisation, storage and transport infrastructure, and strengthening the agricultural value chain can help tame prices and improve food security.
The government must improve public spending efficiency by cutting waste, enforcing fiscal transparency, and redirecting resources toward health, education, and expanding social protection coverage for the vulnerable.
The federal and state governments should expand social protection programmes to cushion the poor from the short-time pains of the reforms. Conditional cash transfers, school feeding schemes, and targeted support for smallholder farmers are essential steps in the right direction.
The implementation of some of these schemes, however, has been at best shoddy. The conditional cash transfer scheme is the worst culprit. The so-called cash transfer hardly reaches the vulnerable population for which it is meant.
There are loud grumbles from many communities where potential beneficiaries are taken through the rigour of the requisite registration but wait interminably for the money that never comes. Where it does at all, it does only in trickles. The cash is obviously enriching some wicked and corrupt individuals at the expense of the hapless poor.
This is the vilest extent greed and avarice can go under a perilous situation where a NBS data indicates that the poor now spend over 70% income only on food. The authorities should investigate this, deal with those involved and tighten the loose ends to ensure that the cash gets to real vulnerable people.
The tax reform laws, which are designed to provide relief for low-income earners and small companies, are ordinarily laudable. But the implementation quite impolitically took off on January 1, against the grain of popular demand. But compliance remains germane. Yet, little is known about the new tax legislations.
The authorities, therefore, need to go beyond perfunctory sensitization as has been done mainly on social media through influencers, in an ecosystem where those who have smart phones are far less than those who do not.
Let the National Orientation Agency (NOA) embark on massive awareness through town hall meetings and other populist channels to expand the knowledge of the stakeholders and ease compliance with the new laws.
In addition, the government needs to expeditiously clear the controversy surrounding the alleged discrepancies in the gazetted laws to ensure a more transparent tax system and avoid further legislative backlash, which could undermine implementation.
The administration’s economic reforms have significantly improved the revenues of the states. The three tiers of government now share trillions every month, shelling out humongous funds into their kitties every month from the Federal Account Allocation Committee (FAAC).
How well the states are using these increased revenues, however, remains to be seen. While a few state governors are actually doing well in the area of infrastructure and palliating their people in some ways, many of the state chief helmsmen are largely given to profligacy and ostentatious lifestyles in the midst of the misery that continues to wallop their people.
The President, the people themselves and civil society groups should hold the governors accountable and force them to embark on productive ventures and tangible poverty-alleviation schemes that will directly palliate the people and ease their suffocating hardships.
That is part of the promises made by the government to thaw out the people to make them support the removal of fuel subsidy. But in many of these states, there is virtually nothing on ground to show the increasing revenues from the savings flowing into them every month. This is highly unacceptable. Things should change for the better.
Meanwhile, hope brightened on the horizon on Christmas Day. The banditry challenge assailing the nation turned into a humdinger of relief following the United States’ devastating air strikes against the Lakurawa terrorists in Sokoto.
The attack, carried out in conjunction with the Nigerian military, was a game changer that has turned the tables against the terror gangs, thousands of whom were reportedly buried alive, having been taken in their sleep during the lethal hits. Those who survived the attack are either on the run or in total disarray.
While the military has been carrying out effective mop up operations, which have upended the militants’ terror cells, there are reports that the US is already undertaking intelligence, renaissance and surveillance (IRS) exercises on the massive Sambisa forest, the gangland of Boko Haram sects and their splinter gangs.
This is understood to be a precursor to launching the second US grisly aerial bombardment in Nigeria, this time against the Islamic militants, who have held the Sahelian region of northeast by the balls for 16 nightmarish years. Their murderous campaign started in Borno in 2009 following the death of their pioneer leader, Mohammed Yusuf, in questionable circumstances.
It is expected that the second US devastating expedition would, hopefully, neutralize the terror cells of these insurgents and upset the apple cart for them after almost two decades of their sanguinary activities, which have resulted in thousands of deaths and millions being displaced.
This is the kind of foreign help and collaboration we have consistently advocated. And if this initiative is sustained and extended to other critical terror-ravaged states like Zamfara, Katsina, Plateau, Benue, Niger, Kwara, Kaduna, Kogi, Kebbi and others, substantial swaths of the country, including the food belts, would have been freed to resume robust agricultural production activities. This will not only revive agro-exports, it would boost food security and minimize hunger that has literally stalked the land for years.
Now, the political horizon has been getting rather grubby since the immediate past year with a slew of sickening defections from the opposition parties to the ruling party, raising concerns about the fate of multi-party democracy. The political atmosphere had particularly become too rumbustious for an administration that just grossed the mid-term mark in May, last year.
Like we posited in an earlier editorial, it perhaps took the belligerent threats of military invasion from US President Donald Trump to nudge the government back to reality. This year, the administration is gradually inching towards the twilight of its first term.
Ideally, politicking is bound to feature in this eve of 2027, especially towards the end of the year. This is also the year that the Independent Electoral Commission (INEC) will begin preliminary preparations towards the main elections next year, beginning with updating the voters registers to take in those who are just clocking the voting age and or those who failed to register earlier.
However, governments at all levels should exercise utmost restraint and sense of responsibility to guide against the temptation of abandoning the serious business of governance for frivolous politicking this year, as witnessed last year.
Our political leaders should rather balance the delicate equation, focusing more on delivering the dividends of democracy for which they were elected. This is hardly the time to give in to complacency because this period is a defining moment for the nation in some respects.
First, our gallant military needs to be constantly incentivized by the commander-in-chief to do the required mop up operations to prevent the “renegades” or militants fleeing the onslaughts in the terror enclaves from escaping to safer areas, north and south.
The only way to completely defeat these terrorists is to sustain the fire against them till the last of their terror cells is dismantled. Otherwise, these vile elements are believed to possess an uncanny capability to regroup within a short spell if they are allowed any modicum of breather.
Second, according to economic buffs, the nation’s economy may have successfully scaled what they describe as the “risk” phase into the “recovery” phase, with the modest gains accruing from the bold economic reforms.
Economists believe that the Tinubu administration, to its credit, has taken difficult but necessary steps to stabilise the economy. The removal of fuel subsidies, unification of exchange rates, and tighter monetary policy have, in their estimation, begun to create fiscal space and restore investor confidence.
But according to the World Bank’s admonition, which is shared by economic experts, these gains are only the first phase of recovery. Inflation is bound to remain high and the growth already recorded will remain “narrow and exclusionary;” without being complemented by structural reforms, especially in such areas as agriculture, energy, and transport, among others.
The President and his economic team own it a duty to Nigerians at this stage to continue to work conscientiously for the economy’s full recovery and make the gains from the reforms reflect on the people’s living conditions. They should not allow the distractions of the 2027 politicking to scuttle this onerous task.
Copyright @NewsClick Nigeria Media. No part of this piece or whole should be copied, used or shared without due credit to NewsClick Nigeria – www.newsclickng.com