CPPE: Tinubu’s Reforms Stabilised Economy, But Welfare Gains Still Limited

The Centre for the Promotion of Private Enterprise (CPPE) says the first three years of President Bola Tinubu’s administration largely focused on correcting deep-seated macroeconomic distortions inherited at inception. While the reforms helped stabilise key indicators, the think tank notes that the benefits have yet to translate meaningfully into improved living standards for most Nigerians.

Macroeconomic Fault Lines at Inception

According to CPPE’s review, the administration began its tenure amid acute foreign exchange shortages, a multiple exchange rate regime, weakening external reserves, and eroding investor confidence. On the fiscal front, pressure was compounded by extensive Ways and Means financing and leakages tied to fuel subsidy arrangements.

Pillars of Stabilisation

CPPE’s Chief Executive Officer, Muda Yusuf, identified two anchor policies driving the stabilisation agenda:

• Fuel subsidy removal to curb fiscal leakages and redirect public resources.
• Exchange rate unification to improve market transparency and reduce distortions.

Together, these measures eased pressure on public finances and set the stage for a more market-reflective foreign exchange framework.

Short-Term Pain and Rising Living Costs

CPPE cautioned that the reforms also produced significant near-term hardships. Currency depreciation and higher energy prices fed into transport and production costs, intensifying inflation and import-driven price pressures. As a result, real incomes fell, poverty deepened, and the cost-of-living crisis worsened, even as some macro indicators improved.

Early Signs of Recovery

Despite the strain on households, CPPE highlighted several markers of stabilisation and recovery:

• External reserves trended toward the $50 billion range.
• Trade surpluses were sustained, while investor sentiment improved.
• Exchange rate volatility moderated from 2025.
• An 11-month disinflation spell occurred from early 2025 to February 2026, before fresh price pressures resurfaced following geopolitical tensions in March 2026.
• The capital market rallied strongly: the Nigerian Exchange All-Share Index surged from about 55,700 points in 2023 to over 254,000 points in 2026, and market capitalisation climbed from around N30 trillion to above N160 trillion.

CPPE also noted that halting Ways and Means financing improved fiscal discipline. Meanwhile, rising domestic refining capacity—led by the Dangote Refinery—supported foreign exchange savings and bolstered energy security.

Welfare Gains Still Limited

Despite these gains, CPPE stressed that inflation, weak purchasing power, and low consumer confidence remain major headwinds. With macro stability improving, CPPE argued the policy focus should now pivot from stabilisation to inclusive growth—creating jobs, lifting incomes, and reducing poverty.

Risks and Structural Constraints

Insecurity remains a critical threat to economic recovery, particularly in agriculture and rural communities. CPPE warned that food security goals are unattainable if farmers face persistent threats and disruptions. Other structural impediments continue to weigh on productivity and job creation, including:

• High energy costs
• Infrastructure deficits
• Policy inconsistency
• Logistics and supply-chain bottlenecks
• Elevated interest rates and tight credit conditions

Debt Dynamics

On public finance, CPPE reported that total public liabilities rose to N159.3 trillion as of December 2025. The increase was attributed to currency depreciation effects and the restructuring of outstanding Ways and Means obligations.

The Road Ahead

CPPE’s assessment concludes that the administration has made notable strides in stabilising the macroeconomic environment through tough but necessary reforms. The central challenge now is to translate those gains into broad-based welfare improvements by easing inflation, strengthening food and energy security, lowering production costs, improving policy coherence, and addressing insecurity to unlock investment, productivity, and jobs.