Tinubu’s shock therapy: Economic reforms or economic suicide?

In an editorial piece published on August 8 by BusinessDay, “Beyond the protests: A nation fractured”, it explored Nigeria’s troubling economic reforms under President Bola Tinubu. A number of Nigerians are now living in greater poverty as a result of the reforms, which were supposed to shake the nation out of its economic crippling weakness. Described by government officials as “shock therapy,” the removal of fuel subsidies and the floating of the naira have had catastrophic consequences on the average Nigerian. One cannot help but recall the famous words of John Maynard Keynes: “In the long run, we are all dead.” For the millions of Nigerians battling hunger, inflation, and joblessness, the crisis isn’t one for the long term—it is immediate, devastating, and existential.

Indeed, it is a bitter irony that while the Nigerian government trumpets its economic reforms as necessary repairs, these measures have dismantled livelihoods. At their core, these policies have failed because they ignored fundamental economic complementarities. The hasty removal of subsidies and currency reforms without bolstering foreign exchange inflows, improving export capacities, or even addressing inflation through fiscal discipline has left the economy to spiral out of control. Inflation now hovers at a three-decade high, businesses are shutting their doors, and the naira continues its downward plunge. It is no surprise that foreign investors spooked by these dire conditions are fleeing in droves.

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Nigeria’s economic challenges are compounded by an alarming detachment from the leadership. Tinubu’s economic blueprint does little to address the concerns of ordinary Nigerians, many of whom now live in subhuman conditions, driven into despair by rising prices and shrinking incomes. It is telling that while subsidy fraudsters enjoy their ill-gotten gains, ordinary citizens are saddled with soaring costs of fuel and food. The manufacturing sector, once the pride of Nigeria’s industrial prowess, is decimated by sky-high interest rates and persistent dollar shortages. Tinubu’s reforms, though cloaked in the rhetoric of tough love, are proving to be little more than a reckless economic gamble.

As BusinessDay has observed before, shock therapy alone cannot cure Nigeria’s economic ills. We must implement structural reforms with precision and foresight. Yet, this administration seems content to embrace policies that are more akin to a wrecking ball than a knife. The result? An economy that grows weaker by the day, incapable of producing the jobs, stability, and opportunities that Nigeria so desperately needs.

“Nigeria’s economy is not merely a victim of poor policy choices; it suffers from a profound failure of leadership.”

Even the much-touted new minimum wage of N70,000 ($44.00) is laughably inadequate. A family would be lucky if such an income could provide for basic sustenance, let alone offer a path out of poverty. As the research group SBM Intelligence astutely pointed out, this sum barely covers the cost of a single pot of Jollof rice—a grim indicator of just how out of touch the government has become. Worse still, only 17 percent of the workforce will benefit from this minimum wage, leaving the vast majority of Nigerians languishing in a brutal cycle of poverty and insecurity.

Nigeria’s economy is not merely a victim of poor policy choices; it suffers from a profound failure of leadership. This is most painfully evident in Tinubu’s handling of national protests and dissent. The #EndBadGovernance protests, which were born out of frustration with government excess and economic hardship, were met with brutal force. There is a profound lack of empathy for the suffering of ordinary Nigerians, as evidenced by the administration’s ongoing profligacy, even in the face of a deepening fiscal crisis. Like Orwell’s political rhetoric, Tinubu’s promises of a brighter future are hollow, designed to obscure the grim realities that millions face daily.

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If Nigeria is to escape this economic quagmire, it will require more than slogans and cosmetic policy changes. It demands real, meaningful reforms—ones that tackle inflation head-on, promote domestic manufacturing, and rebuild confidence among investors. But most of all, it requires a leadership that is not only capable of managing the economy but one that truly cares about the well-being of its citizens.

If these essential adjustments are not swiftly implemented, Tinubu’s reforms may ultimately be recorded in history not as the bold solution Nigeria so desperately needed but as a costly gamble that worsened the country’s economic challenges and deepened the hardships endured by its citizens. However, the situation is not beyond repair.

The Nigerian government still has the opportunity to shift course by taking a more inclusive and pragmatic approach to economic reform. By focussing on policies that stimulate sustainable growth, curb inflation, and protect the most vulnerable, the administration can restore confidence in its leadership and pave the way for a brighter future. It is crucial that the government recognises this reality and acts with urgency before the window of opportunity closes.