...Dangote Refinery offers hope, but reforms must reach kitchens
LAGOS-- Despite the recent rebound of the naira and ongoing economic reforms by President Bola Tinubu's administration, improved living standards may remain elusive for millions of Nigerians unless fiscal discipline, inclusive spending and private-sector reforms are urgently implemented.
This warning came from Chief Dele Kelvin Oye, chairman of the Alliance for Economic Research and Ethics, AERE, and immediate past chairman of the Organised Private Sector of Nigeria.
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The naira has strengthened in recent weeks, trading around ₦1,340/$ at the parallel market as of February 20, 2026, compared to previous lows beyond ₦1,600/$.
Vice President Kashim Shettima recently suggested the currency could have appreciated to ₦1,000/$ under different intervention conditions.
But Oye cautioned that currency appreciation alone does not automatically lower prices, create jobs or reduce poverty.
Monetary discipline vs fiscal pressure
According to him, the naira's rebound reflects credible reforms and tighter monetary policy by the Central Bank of Nigeria, CBN.
"The naira's rebound reflects real reform, a credible CBN, and Nigerian entrepreneurial grit. But fiscal dominance, huge deficits, debt service, and inefficient spending remain counterweights," Oye said.
He explained that fiscal dominance -- where government borrowing and spending overwhelm the central bank's inflation fight -- remains a major risk.
Nigeria's 2026 budget, estimated at about ₦58 trillion, carries a deficit of over ₦23 trillion, while debt servicing continues to consume a significant portion of revenue.
Although Federation revenue reportedly rose from ₦16.8 trillion in 2023 to ₦31.9 trillion in 2024, Oye noted that receipts still fall short of projections.
"Without fiscal prudence, private-sector facilitation, and inclusive spending, appreciation will stay a market statistic, not a lived improvement for most Nigerians," he warned.
Headline inflation, according to the National Bureau of Statistics, eased slightly to 15.10 per cent in January 2026, but food prices remain high, squeezing households.
Dangote refinery boost, but...
Oye acknowledged the role of the Dangote Refinery in boosting optimism about the naira.
He cited increased local production of aviation fuel, polypropylene, liquefied petroleum gas, bitumen and other by-products from the 650,000 barrels-per-day facility as factors reducing fuel imports and saving foreign exchange.
"Entrepreneurship, not only policy, drives real value," he said, noting that expanded production capacity could further cut import bills, create jobs and spur industrial growth.
However, he warned that macroeconomic stability must translate into tangible benefits.
"Macro stability hasn't reached kitchens," he said, referencing the World Bank October 2025 update which put the number of Nigerians living in poverty at 139 million, up from 87 million in 2023.
Aggressive tax enforcement
Oye criticised what he described as aggressive tax enforcement, arguing that businesses require trade facilitation, not a "hunting mindset."
He called for faster licensing processes by regulatory agencies, reduction of overlapping taxes and improved policy certainty.
"What businesses need is trade facilitation -- fewer duplicative levies, predictable policies and regulatory efficiency," he said.
He urged the Federal Government to curb borrowing, cap domestic debt, and channel increased allocations to revenue-yielding investments rather than consumption projects.
"Shift from consumption to power, feeder roads and storage that stimulate private capital and lift productivity," he advised.
Risks to exports, rural incomes
The sudden appreciation of the naira, Oye added, may also hurt non-oil exporters.
He cited cocoa farmers who now face local prices above global benchmarks, squeezing margins and discouraging rural incomes.
He warned that if money circulation accelerates only in major cities like Lagos and Abuja, growth could recycle into luxury real estate, widening inequality.
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"Growth must circulate, not pool," he stressed.
Reform durability
Oye further noted that cryptocurrency demand tends to spike when the naira weakens, but calmer Bitcoin inflows have coincided with the recent currency stability.
He also pointed to discussions within the Economic Community of West African States, ECOWAS. on invoicing petrol sales in naira as a potential boost to regional demand for the currency.
However, he warned that reform durability depends on social cushioning and mass job creation.
"Expand targeted cash transfers, invest in health, education and vocational training before reforms mature," he advised.
The warning comes as Nigeria navigates a delicate balance between monetary tightening and expansive fiscal spending.
While the naira's rebound signals improved market confidence, analysts say the real test will be whether those gains translate into jobs, lower food prices and broader economic opportunity.
For now, as Oye put it, appreciation may remain a promising headline but not yet a shared national experience.
