By
Nze David N Ugwu
Over the past decade Nigeria has been swept by a series of high-stakes economic reforms meant to resuscitate public finances, attract investment and convert the country’s natural-resource advantage into broad-based development. Some of the most consequential moves — the 2021 Petroleum Industry Act (signed under President Muhammadu Buhari), the Treasury Single Account and ease-of-doing-business drives through Buhari’s term, and the shock reforms of President Bola Ahmed Tinubu (notably the removal of the fuel subsidy, the floatation of the naira and a wholesale tax overhaul) — have reconfigured Nigeria’s policy landscape. But the defining question today is not what was legislated or announced; it is how those reforms were executed, and with what social, institutional and economic consequences.
This article unpacks the substance of the reforms of the two administrations, examines the recurring execution challenges — from weak institutions and political backlash to capacity gaps and communication failures — and offers a concise set of pragmatic lessons for policymakers, civil society and the press.
The reform menu: what was done (and why it mattered)
Buhari’s reform architecture: laws, institutions and incremental change
The Buhari presidency (2015–2023) left a mixed policy legacy: on the one hand, institutional reforms such as the Treasury Single Account (TSA), a sustained push to improve the business climate via the Presidential Enabling Business Environment Council (PEBEC), and the long-deliberated Petroleum Industry Act (PIA) of 2021 aimed at rationalizing the oil sector and attracting investment. These moves were designed to stem fiscal leakages, improve revenue flows, and create a more transparent regulatory structure for Nigeria’s most important export.
Tinubu’s shock therapy: subsidy removal, currency unification and tax overhaul
President Bola Tinubu’s administration (from May 2023) adopted a more disruptive, front-loaded approach. Within weeks of taking office the federal government ended the long-standing petrol subsidy that had kept pump prices artificially low; shortly afterwards the Central Bank moved to unify and float the naira, leading to a sharp devaluation of the official rate. Tinubu also set out to remake Nigeria’s revenue architecture by proposing and later signing sweeping tax reform acts and institutional changes intended to boost domestic revenue mobilization. The declared objective of these measures was fiscal consolidation — to reduce recurrent subsidy bills, close financing gaps and free resources for infrastructure and social investments.
Two case studies in shock and reform
A — Fuel subsidy removal (May 2023): the shock the public felt
The removal of the petrol subsidy was politically courageous in the sense that it tackled a perennial fiscal albatross. But it was also immediately regressive in effect: pump prices rose sharply, transport and distribution costs jumped, and consumer prices for food and basic goods followed. The move triggered mass protests and threatened large-scale labor action by unions — prompting the government to announce cash transfer packages and other palliatives. While market economists welcomed the end of a distortion that had favoured rent-seekers over citizens, the rapidity of the policy and the limited immediate cushioning measures exposed the poor fit between policy design and social reality.
B — Naira float/unification (June 2023): a necessary fix with painful transitional costs
Nigeria’s multiple exchange-rate regime had for years dampened investor confidence and fostered forex arbitrage. In mid-June 2023, the naira was effectively floated and the multiple official rates were unified — which produced an instant devaluation and triggered imported inflation pressures, but which the government argued was a precondition for restoring external investor confidence and normalizing foreign exchange flows. The IMF and other international actors have subsequently argued that a unified, market-driven exchange rate is a key structural reform — but the speed of the adjustment and weak social protection made the short-term costs politically volatile.
Execution challenges: why good policy often failed at delivery
When policy and politics collide, execution becomes the battlefield. Nigeria’s experience under both administrations highlights several persistent execution bottlenecks:
- Institutional fragmentation and capacity gaps
Nigeria’s federal structure, the proliferation of agencies, and fragmented revenue collection have long complicated delivery. Major reforms require coordinated action across ministries, the Central Bank, state governments and statutory bodies. Where coordination faltered — for example, in rolling out large-scale cash transfers or in converting transport fleets to CNG to cushion fuel price shocks — implementation lagged or produced uneven results. The government’s repeated resort to short-term palliatives exposed the absence of functional, rapid-scale social protection systems.
- Weak communication and political economy misreads
Execution is political. Policies that redistribute costs into everyday budgets need pre-emptive engagement with unions, transport associations, private sector groups and state governments. Tinubu’s early, decisive actions (subsidy removal and forex unification) were presented as necessary and non-negotiable; that clarity helped markets but alienated large swathes of citizens and labour leaders, producing strikes and public protests that disrupted the economy and raised the political cost of follow-through. The result was a cycle of announcements followed by reactive palliatives — cash transfers, temporary waivers and negotiations — rather than strategically sequenced reforms with durable buy-in.
- Corruption, procurement weaknesses and “leakage”
Structural leakages — procurement abuse, opaque contracting and the diversion of oil revenues — blunt reform impacts. The Petroleum Industry Act promised greater transparency, but critics warned of new loopholes and continued governance risks unless accountability institutions were strengthened. Similarly, instruments designed to capture savings (for example, expected fiscal gains from subsidy removal) can be dissipated if public procurement, budget oversight and audit functions remain weak. Recent government discussions about amendments to the PIA and concerns about “statutory leakages” underline this point.
- Fiscal sequencing and macroeconomic management complications
Ending subsidies and devaluing the currency improve long-run budget health, but they also shrink real incomes, raise inflation and can erode the tax base in the short term if not carefully sequenced with compensatory measures. The macroeconomic stabilizers (reserves, credible monetary policy, and targeted social transfers) were sometimes insufficient or arrived late, leaving ordinary Nigerians exposed to a spike in cost-of-living. The IMF’s 2025 Article IV and subsequent analyses note improving reserves and gradually lower inflation, but these gains followed a painful adjustment.
- Implementation design flaws: scale, targeting and fraud risks
The government’s cash transfer schemes — designed to cushion the poor — faced problems of identification, leakage and public skepticism. Efforts to use national ID systems and BVN checks were sensible, but bottlenecks in database coverage and distrust about beneficiary selection limited public confidence. In some places, distribution was slow or captured by middlemen; elsewhere, the sums were judged too small to offset the price shocks. Practical program design — beneficiary identification, payment rails, grievance redress and independent auditing — proved decisive for outcomes but was often underdeveloped.
Evidence of outcomes: winners, losers and the fiscal picture
Fiscal gains (real but contested)
Ending petrol subsidies freed up headline fiscal space and reduced regular ad hoc oil-sector drains on the budget. Likewise, tax reforms and moves to unify revenue collection were explicitly intended to raise the revenue-to-GDP ratio — Nigeria’s tax take has historically lagged peers, creating dependence on oil rents and borrowing. The 2025 tax reform package — when signed into law — represented a major attempt to modernize tax administration and widen the tax net. International partners including the IMF have urged revenue mobilization as central to sustainable public finances.
Short-term pain: inflation, transport and living costs
The immediate aftermath of subsidy removal and currency floatation was higher pump prices, rising transport costs and a spike in inflation that hit the poor hardest. Nationwide labour actions and pockets of service disruption (electricity, transport) underlined how quickly social tensions rose when reforms intersected with fragile livelihoods. The government’s cash transfers and emergency palliatives helped but were treated by many citizens as stop-gaps rather than durable protection.
Markets and investor signals
Capital markets and some international investors responded positively to the clarity of intent around market reforms — floatation and subsidy removal reduced certain distortions that had deterred foreign participation. But sustaining investor confidence requires durable macro stabilization, progress on infrastructure and institutional predictability — none of which is achieved by single measures alone. The IMF’s mid-2025 assessment recorded improving reserves and some disinflation, while urging careful sequencing of further reforms.
Why execution succeeded sometimes — and how those features can be replicated
A few reform elements worked better because they followed sensible execution logic:
1) Legal and institutional anchors. Where reforms were anchored in law (PIA, TSA) or supported by a clear institutional owner (PEBEC for business reforms), implementation could proceed even if imperfectly. Legal frameworks matter because they create rules, not just rhetoric.
2) Targeted support backed by delivery rails. Cash transfers that used BVN and bank channels achieved faster disbursement than ad hoc handouts — demonstrating that payment infrastructure and identity systems matter. Where the government invested in digital payment rails and verification systems, rollout was quicker and leakage lower.
3) Engagement with key constituencies. Short-term strikes were often averted or mitigated when unions and the government engaged in early talks and set out time-bound mitigation packages. Engagement doesn’t eliminate pain, but it reduces the chance of paralysis.
Recommendations: making execution the centre-piece of reform
For reforms to be not just announced but actually delivered in ways that preserve social cohesion and deliver gains, Nigeria needs to make execution a conscious, funded and accountable project. The following are practical steps:
- Sequence reforms and build pre-announced protection packages. Reforms that raise prices should be sequenced with social protection (well-targeted cash transfers, food programmes) that are financed and ready to operate on day-one. Announcing a relief programme is not the same as having the systems to deliver it.
- Invest in data, identity and payment infrastructure. Expanding national ID coverage, BVN linkage, and mobile/electronic payment rails reduces leakage and speeds up targeted relief. These systems also expand the fiscal space by improving compliance and enforcement.
- Strengthen intergovernmental coordination.Federal reforms affect states and local governments. A standing implementation taskforce with state representation, transparent targets and public dashboards will reduce blame-shifting and speed execution.
- Protect the vulnerable while broadening the tax base.Fiscal consolidation plans should combine progressive measures — protect the poorest with transfers — with credible steps to raise revenue (simplify taxes, harmonize collection, crack down on corporate tax avoidance).
- Tighten procurement, auditing and public reporting.Savings from subsidy removal and new revenues must be visible; independent audit, open procurement and regular reconciliation of oil revenues will build public trust.
- Institutionalize stakeholder engagement.Unions, transport associations, business groups and civil society should be formally part of reform roadmaps so that trade-offs are negotiated and understood in advance.
Conclusion — reform is necessary; execution is everything
Nigeria sits at a policy inflection point. The reforms of the Buhari and Tinubu administrations — from the Petroleum Industry Act and Treasury Single Account to subsidy removal, naira unification and tax overhaul — aimed to address long-standing structural dysfunctions. Many of those policies were economically defensible and in some cases legally durable. But policy intent alone did not ensure positive social outcomes. The recurring pattern has been a technical reform announcement followed by implementation shortfalls, weak cushioning for the poor, and political backlash that complicates the policy path.
If Nigeria is to translate legislation into development, it needs to treat execution not as technical housekeeping but as the political heart of reform: fund delivery, invest in systems, engage stakeholders, and make accountability public and enforceable. Without that shift, reforms will continue to be judged less by their fiscal arithmetic than by whether Nigerians can still afford a bus ride or fill their family’s kettles.
NZE DAVID N. UGWU IS A MANAGEMENT CONSULTANT
