Nigeria is a nation on the brink of economic paradox. Why? In a country where over 60 per cent of the population lives in multidimensional poverty, the announcement of a 40 per cent increase in government revenue to ₦6.9 trillion in Q1 2025 might seem like good news. It suggests a functioning system, disciplined fiscal management, and rising investor confidence. However, the reality on the ground tells a different story. While official macroeconomic figures continue to show upward trends, the average Nigerian household is in deep distress. Staple food prices have soared beyond reach, insecurity has heightened, disposable income is shrinking, and the promise of economic growth seems like a distant mirage to millions.
What then is the true meaning of economic progress when its dividends are neither felt by nor accessible to the people? This article is a professional rejoinder to the recent proclamations by government officials, presenting a wider lens to critically evaluate the current state of Nigeria’s economic planning, its assumptions, its disconnections, and, more importantly, its implications.
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Rising revenues amid rising poverty: the disconnect
According to the Minister of Finance, revenue generation reached a record ₦6.9 trillion by April 2025, a 40% increase from last year. This is attributed to technological innovation and the blocking of fiscal leakages. Yet, this growth in public finance has not translated to economic relief for the population. On the contrary, the majority of Nigerians are battling record-high inflation, stagnant wages, and a declining quality of life.
When government revenue expands without corresponding improvement in public welfare, it points to a systemic disconnect. Where is the investment in public infrastructure, in affordable food systems, in rural livelihoods, in job creation? A fiscally solvent state that presides over mass hunger is not a successful state—it is an unstable one.
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Inflation and the fuel subsidy shock
The removal of fuel subsidy and unification of exchange rates in 2023 were hailed as bold reforms. In principle, they align with market-based economic models that promise long-term efficiency. In practice, however, these moves unleashed a wave of inflation that hit the most vulnerable segments of society the hardest.
The cost of transportation doubled or tripled in some regions. Bread, rice, garri, and yams—common staples for the poor—became luxury items. With minimal social protection buffers in place, the average household now spends over 60% of income on food alone, leaving little for housing, health, education, or savings. This is not economic liberalization; it is economic abandonment.
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Multidimensional poverty and the missing safety net
Multidimensional poverty goes beyond income. It encompasses access to healthcare, education, clean water, decent housing, and human security. By this definition, Nigeria is facing a full-blown poverty crisis.
According to the National Bureau of Statistics, over 133 million Nigerians live in multidimensional poverty. Yet the pace of intervention does not match the scale of the challenge. While the government cites Shell’s renewed $5.5 billion investment and an ambitious ₦100 trillion asset management target for MOFI, the critical question remains: How will these translate into real jobs, better schools, and lower food prices for the people?
What is the direct mechanism for converting upstream oil investment into downstream poverty reduction? How is the government ensuring that growth in asset value also means growth in public welfare?
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Shared responsibility, shared failure
It is not enough to criticize federal plans without examining the role of subnational governments. States and local governments are constitutionally empowered to drive grassroots development. Unfortunately, many have failed to invest in agricultural transformation, local manufacturing, or internal revenue diversification.
Instead, there is an overreliance on federal allocation, leading to widespread fiscal irresponsibility and poor service delivery. To truly combat poverty and inflation, both tiers of government must collaborate on strategies that boost food production, stabilize prices, and create sustainable employment.
5. The street-level impact of economic policy
The real verdict on any economic policy is not given in government press briefings; it is delivered on the streets. In Kano, a mother feeds her children only once a day. In Lagos, ride-hailing drivers are abandoning their jobs because fuel is unaffordable. In Sokoto, farmers are unable to access fertilizers due to rising costs.
Inflation is not an abstract percentage; it is the anguish in the eyes of a father who cannot buy diapers for his child. It is the decision a teenager makes to drop out of school and hawk on the highway. This is the lived reality that government officials must be attuned to.
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Inflation and disposable income
The erosion of disposable income has been relentless. According to a recent report by SB Morgen, the average Nigerian’s purchasing power has declined by over 40% in the last two years. Salaries remain stagnant while prices double.
What economic strategy addresses this crisis? Is there a living wage framework under discussion? Are inflation-adjusted stimulus plans being considered? It is not enough to increase GDP or FIRS revenue; the real test is whether people can afford beans and bread.
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Policy suggestions
- Scale Agricultural Investment: The country must shift from subsistence to mechanized farming. This includes state-funded irrigation, post-harvest storage, and processing clusters.
- Rebuild Social Safety Nets: Expand conditional cash transfers, school feeding programs, and universal basic health coverage to protect the vulnerable.
- Stabilize the Currency Through Production: True currency stability will come not from foreign exchange controls, but from boosting local manufacturing, agro-processing, and services.
- Empower the Informal Sector: The informal economy employs over 60% of the population. Targeted microcredit, skill development, and market access are critical.
- Ensure Fiscal Transparency: Citizens must see where the ₦6.9 trillion is going. Budget tracking, project auditing, and citizen feedback loops must be institutionalized.
- Address Insecurity as an Economic Threat: Farmers cannot grow food if they are being kidnapped. Security must be treated as an economic enabler, not just a military matter.
- Make energy available: The twin combination of fuel (PMS, AGO) and electricity remain an albatross for Nigeria economic development. Until the FG and subnational government work together to fix this challenge, we are not ready for development
Conclusion:
It is commendable that the government is blocking leakages, increasing revenue, and attracting new investments. These are critical enablers of growth. But the true goal of economic management is not statistics; it is dignity. It is in whether a child sleeps on a full stomach. Whether a mother can afford insulin. Whether a youth has hope beyond emigration. It is time to move from numbers to impact, from vision to compassion.
Leadership must transcend celebration of numbers and enter the arena of people’s pain. We must ask: Are we building an economy that serves the nation or one that survives in spite of it? Until the ordinary Nigerian feels relief, not just in markets but in their homes, our job is far from done.
The time to recalibrate is now. Our people cannot wait any longer.
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Prof. Sarumi is the Chief Strategic Officer, LMS DT Consulting, Faculty, Prowess University, US, and ICLED Business School, and writes from Lagos, Nigeria. He is also a consultant in TVET and indigenous education systems, affiliated with the Global Adaptive Apprenticeship Model (GAAM) research consortium. Tel. 234 803 304 1421, Email: leadershipmgtservice@gmail.com.
