The removal of petrol subsidy, unification of the foreign exchange market, implementation of the Petroleum Industry Act (PIA), tighter monetary policy, and ongoing tax overhaul as the major reforms driving improvement in economic fundamentals.
The implementation of these reforms have enabled the economy to emerge from a difficult period of adjustment to era of continued growth and development across major economic indicators
The Nigerian economy has turned the corner after several reforms instituted by the Federal Government. Today, what we have is an economy that has moved from acute macroeconomic distress to a more stable and increasingly resilient position.
Speaking during a media interview, Executive Chairman of Nigeria Revenue Service (NRS), Dr. Zacch Adedeji, agreed that the Nigerian economy had emerged from a difficult period of adjustment.
Adedeji said a combination of far-reaching reforms had moved the country from period of economic turmoil to an era of strong economic fundamentals.
The NRS boss said the reforms implemented by President Bola Tinubu since May 2023, when he was sworn in, were beginning to produce stronger and more measurable outcomes across the economy.
He said the economy was now showing “strong signs of full recovery and accelerated growth” following the difficult adjustments triggered by the initial reforms.
According to Adedeji, improvements in exchange rate stability, moderating inflationary pressures, and liquidity conditions have strengthened business confidence and enabled companies and investors to make longer-term decisions with greater certainty.
Adedeji stated, “Nigeria’s economy is showing strong signs of full recovery and accelerated growth following a series of necessary reforms by the current administration.
“The economy has moved decisively from acute macroeconomic distress to a more stable and increasingly resilient footing.
“This is as a result of President Bola Tinubu’s economic management acumen and doggedness in implementing his reforms as part of his Renewed Hope Agenda for the country.”
The NRS boss stated that the banking sector recapitalisation had strengthened the financial system’s capacity to support large-scale corporate financing, adding that the ongoing tax reforms have simplified administration and broadened the revenue base.
He said, “These reforms have improved the overall business climate and reduced structural inefficiencies as well as enhanced the operating environment for capital intensive and export-oriented firms by improving market efficiency, strengthening macroeconomic stability, increasing investor confidence.”
He affirmed that comprehensive structural reforms embarked upon by the current administration had translated into measurable improvements in corporate financial performance through stronger market fundamentals and a more predictable business environment.
“The resulting improvements in operational efficiency, financial transparency, and investment planning provide a clear economic explanation for the substantial increases in both revenue and earnings before tax recorded by many of the companies in this dataset,” Adedeji said.
Understanding the bold reforms
S&P Global Ratings recently acknowledged that improvement in Nigeria’s credit profile reflected gains from three years of structural reforms, particularly the FX liberalisation programmes driven by Central Bank of Nigeria (CBN) Governor, Olayemi Cardoso.
S&P Global Ratings highlighted improved FX market liquidity and $10 billion turnover recorded in April 2026 as one for the major gains of the CBN-led FX reforms.
Also, improved FX market liquidity, stating that average monthly FX turnover rose to $8.6 billion in 2025, while April 2026 alone recorded about $10 billion in market supply.
Nigeria’s external reserves rose to over $52 billion from about $33 billion in 2023, supported by stronger current account balances, lower import demand, fuel subsidy removal, and expanding domestic refining capacity.
The Federal Government’s fiscal reforms, particularly Executive Order 9 signed in February 2026, which mandates the Nigerian National Petroleum Company Limited to remit a larger share of petroleum revenues directly into the Federation Account was also applauded by stakeholders.
The projection is that government revenue could rise to 12.4 per cent of GDP in 2026 from 7.3 per cent in 2023, while debt servicing pressures are also expected to moderate over the medium term.
The development comes amid broader reforms aimed at stabilising Nigeria’s economy after years of exchange-rate distortions, rising fiscal deficits, and foreign exchange shortages.
Inflation, which had surged to 27 per cent has also dropped significantly.
In the foreign exchange market, the country faced a backlog of over $7 billion in unfulfilled commitments. The backlogs have been cleared.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the difficult but necessary reforms undertaken under the leadership of President Bola Ahmed Tinubu are yielding measurable results and laying the foundation for a more stable, transparent and resilient economy.
Oyedele noted that Nigeria’s debt-to-revenue ratio has improved significantly since 2023 and is projected to decline further as reforms continue to take effect.
“The government remains firmly committed to prudent fiscal management, macroeconomic stability and structural reforms that promote inclusive and sustainable growth,” he noted.
He also reiterated the government’s position against the return of fuel subsidies, arguing that previous subsidy regimes created major fiscal distortions, encouraged smuggling and weakened foreign exchange liquidity.
According to him, the administration remains committed to maintaining a market-driven economy built on transparency, competition and regulatory oversight.
He added that the government would continue implementing policies aimed at supporting private investment and creating a stable environment for businesses.
National Economic Performance
Separately, in its report, titled, “National Economic Performance: Baseline (May 29, 2023) vs Current Outlook (Mid-June 2026): A Comparative Review of President Bola Ahmed Tinubu Administration’s Economic Reform Programme,” NRS said the economy inherited four mutually reinforcing distortions in May 2023.
The report said the distortions included an unsustainable fuel subsidy regime, a fragmented and opaque foreign exchange market, an oil sector producing substantially below capacity, and a tax base far below its potential.
According to the report, the removal of the fuel subsidy and unification of the exchange rate within days of Tinubu’s assumption of office constituted the two foundational adjustments from which several subsequent improvements could be traced.
The service said subsidy removal freed federally collectible revenue that had previously been consumed by fuel under-recovery, while FX unification eliminated round-tripping and arbitrage, restoring price discovery and credibility to the currency market.
It said the impact had increasingly become visible in government revenue, investment, production and corporate performance.
Tax collections rose from N12.3 trillion in 2023 to N21 trillion in 2024 and N28.3 trillion in 2025, while total collections stood at N27.1 trillion in the first eight months of 2026.
The improvement also pushed the tax-to-GDP ratio to 13 per cent from 10.3 per cent in 2023, although NRS said there remained considerable room for further expansion towards the government’s 18 per cent target.
It attributed the revenue growth to the digitalisation of tax administration, expansion of the tax base, and the implementation of the new tax framework.
The national e-invoicing system for large taxpayers, it said, was among the key digital initiatives supporting improved compliance, while four new laws that came into effect on January 1, 2026 further transformed the country’s tax administration.
The laws were the Nigeria Tax Act, Nigeria Tax Administration Act, Nigeria Revenue Service Establishment Act, and Joint Tax Board Establishment Act.
The transformation of the former Federal Inland Revenue Service into NRS also helped to expand the revenue consolidation framework by bringing together non-tax revenue streams previously collected by other government agencies, the report said.
The service stated that non-oil sources now accounted for 76 per cent of total collections, describing the development as a major step towards diversifying public revenue, even though oil receipts remain significant.
NRS projected that revenue mobilisation could strengthen further as e-invoicing coverage expanded and the new tax laws became fully operational in 2026 and 2027.
The service also pointed to improvements in the country’s debt position, saying the debt-to-GDP ratio declined from 35.5 per cent in 2025 to 32.3 per cent in 2026.
It attributed the decline largely to nominal GDP growth outpacing debt accumulation, and stated that the ratio remained below the IMF’s 55 per cent risk threshold.
NRS explained that the increase in naira-denominated debt stock had been driven largely by the revaluation of dollar-denominated obligations following the movement in the exchange rate rather than fresh borrowing.
It pointed out that investor confidence had also improved, citing the oversubscription of Nigeria’s November 2025 Eurobond by 12 times and a record order book as evidence that international markets were increasingly pricing Nigerian risk more favourably.
However, NRS cautioned that debt-service-to-revenue remained an important metric requiring sustained attention.
It said stronger domestic revenue mobilisation remained the more durable route to reducing the burden and creating additional fiscal space for capital expenditure.
The oil and gas sector also recorded a significant turnaround, according to NRS, with crude production recovering to about 1.73 million barrels per day by August 2026, equivalent to about 104 per cent of Nigeria’s OPEC quota.
That was against the production of between 1.2 million and 1.3 million barrels per day around the beginning of the reform period.
NRS attributed the recovery to intensified security operations against pipeline vandalism and crude theft, as well as continued implementation of PIA, which it said had improved fiscal and regulatory certainty for upstream operators.
It acknowledged that monthly output had fluctuated during the recovery but said the overall trajectory remained upward after years of underinvestment and operational disruptions.
Perhaps more significant, the NRS said, was the sharp expansion in domestic refining capacity.
From about 30,000 barrels per day in May 2023, domestic refining capacity rose to approximately 700,000 barrels per day by mid-2026.
About 90 per cent of domestic petrol supply is now being met through local refining, while diesel imports fell to zero by May 2026.
The service attributed the development largely to the growing role of private capital in the downstream petroleum sector, with Dangote Refinery emerging as a major component of the transition.
It said the crude-for-naira arrangement between Nigerian National Petroleum Company Limited and Dangote Refinery had also reduced dollar demand associated with fuel imports, thereby easing pressure on the foreign exchange market.
NRS said the developments demonstrated the impact of providing greater policy and regulatory certainty to unlock private-sector investment rather than relying solely on public financing.
It stated that major upstream transactions involving Seplat Energy and Aradel Holdings had strengthened the long-term prospects of the oil and gas sector by expanding reserves and production capacity, and reducing uncertainty around major investments.
The banking sector recapitalisation was also identified as an important pillar of the emerging recovery.
According to NRS, stronger bank capital positions would improve the capacity of financial institutions to support large-scale corporate financing and provide businesses with greater access to capital for expansion.
NRS said the stronger macroeconomic fundamentals represented a significant shift from the difficult conditions that followed the initial implementation of the reforms.
It, nevertheless, acknowledged that the adjustment had come with considerable pain for businesses and households, but maintained that the economy was increasingly transitioning from adjustment to consolidation.
“Measured against its May 2023 starting point, the Nigerian economy has moved decisively from acute macroeconomic distress toward a more stable and increasingly resilient footing,” the agency stated.