Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has explained the reason Nigerians are yet to feel the full impact of several economic reforms by President Bola Tinubu’s administration.
In a series of videos posted by Bayo Onanuga, the Special Adviser on Information and Strategy to President Tinubu, on Thursday, Oyedele, while fielding questions and addressing an audience during an event organised by the National Orientation Agency (NOA), noted that reforms were yet to be felt in real time because the economy was undergoing a reset after the removal of the controversial fuel subsidy.
“The question that you raised that poverty has gone up and the unemployment rate is high- this is one area I tend to disagree with the World Bank. World Bank would say that poverty has gone up despite the reforms.
“And I say, yes, poverty has gone up because you cannot remove subsidy and people become richer, right?
“The reform itself was a reset. We were living in fiscal illusions. So we needed to stop deceiving ourselves so the country can move forward, and that reset meant that income in that term will fall”, he said.
Oyedele, however, noted that the economy had started to show signs of recovery as of 2025.
“But the good thing is that good news is that the numbers for 2025 in dollar terms say that real per capita growth was nearly 10 per cent.
“That makes Nigeria one of the fastest countries in lifting people out of poverty. The federal government intends to sustain the growth,” he said.
He also addressed lingering concerns on how the Federal Government had so far utilised savings from the subsidy.
After acknowledging the concerns as a positive step in the right direction, the Minister further highlighted some of the areas where part of the subsidy funds had been deployed.
“The whereabouts of the subsidy savings is a valid question. And guess what, the combined impact of the subsidy on fuel, I like to call it subsidy on FX, was about 5 per cent of the GDP. “So you remove both, you save money. But saving money was not the primary objective. It was eliminating the distortion and corruption in the system, which is more fundamental. But the money savings is also important. So where has the money gone to?
“In a few days you will see the detailed analysis because we believe that we owe a duty to explain what we do to the Nigerian people – that’s what transparency looks like. But in the meantime, I can give you some of the highlights.”
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Oyedele challenged Nigerians not to simply compare the past with the present, and conclude that the reforms were bad, but to rather ponder on the difficulties the economy would have been plunged into if subsidy was not removed and reforms were not embarked upon.
“Many Nigerians will simply compare the past with the present and conclude that the reforms is not working for them. Some would even say it is a bad reform.
“What we don’t normally compare, or the question we usually don’t ask, is: where would we have been if the reforms were not carried out- counterfactual.
“Now, before the reforms, we were printing money to spend. Interest rate was about 8 per cent. Minimum rate was N30,000. If you just think about those three- those are big numbers. If we stop printing, the spending doesn’t disappear. The finance, the money you were printing before- that was part of where the savings went.
“Because the reforms induced higher prices, interest rates went up. So instead of paying 8 per cent on our debts, we were paying as high as 24 per cent. When you need to service debts, you don’t debate whether you need to pay. You can’t negotiate it. You pay, and you pay on time. Minimum wage went up from N30,000 to N70,000- that’s almost double the wage bill of the government.
“In addition to other important things like the NELFUND, where over 1.5 million receive not only their tuition but a stipend every month, and if you think that is not important enough – what looks like a means is that about over a million households, the parents no longer have to save, borrow, and be stressed just to pay the tuition. Now they can deploy those resources into their small businesses and to take care of other important basic needs. So, this is significant,” he said.
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The Minister then promised that an elaborate breakdown of how the subsidy savings are being utilised would be released to the public soon.
“What we need to do is provide the detailed explanation of how much we saved and how the money has been spent,” he added.
