Tinubu defends subsidy and foreign-exchange reforms, blames delayed decisions for hardship

President Bola Tinubu has defended his administration’s economic reforms, saying previous governments’ failure to take difficult decisions allowed Nigeria’s economic problems to worsen. In his Independence Day address, he said poverty was rising and hope was nearly gone by 2023, leaving his government with no choice but to act. He specifically defended the removal of petrol subsidies and the unification of the foreign-exchange market.

Mr Tinubu said the country had inherited an unsustainable subsidy regime and an opaque foreign-exchange system. His administration removed the petrol subsidy on May 29, 2023, shortly after he took office, while the Central Bank of Nigeria later collapsed multiple official exchange windows into the Investors and Exporters window. The changes triggered sharp petrol-price increases and a significant depreciation of the naira.

They also contributed to higher transport, food and production costs. Opposition figures and critics have argued that the measures worsened what has been described in the supplied material as Nigeria’s worst cost-of-living crisis in a generation. The President nevertheless said the reforms had improved economic conditions.

He cited growth of more than 4 per cent in 2026, lower oil theft, a substantial fall in inflation from its peak, rebuilt foreign reserves and a more stable foreign-exchange market. He also said non-oil exports generated more than $6bn in 2025. Mr Tinubu said the resources previously spent on subsidies were being redirected to education, healthcare, security, agriculture and infrastructure.

He said the reforms had created additional fiscal space for all levels of government. In May, he said subsidy payments had reached as much as N18.4bn a day at their peak and exceeded N4tn in 2022. The government has faced questions about how savings were used.

Finance Minister Taiwo Oyedele said the funds had largely gone towards debt servicing, higher public-sector wages, student loans and other obligations. Mr Tinubu urged Nigerians to continue supporting the reforms, saying they were required to address infrastructure needs and support long-term growth. He said the next focus would be reducing the cost of living and creating productive employment.