AfriPulse
By the AfriPulse Daily Editorial Team | Last Updated: April 25, 2026
Nigeria’s economy has been at the centre of intense debate for the past two years. From petrol subsidy removal to the unification of foreign exchange rates, from soaring food prices to a naira that has shed more than half its value against the dollar — ordinary Nigerians are living through one of the most economically turbulent periods in the country’s recent history.
In this analysis, AfriPulse Daily breaks down exactly what is happening, why it is happening, and what it means for you — whether you are a market trader in Onitsha, a civil servant in Abuja, a student in Lagos, or a Nigerian in the diaspora sending money home.
Where Nigeria Stands Today: The Headline Numbers
Nigeria’s inflation rate has remained stubbornly elevated. According to the National Bureau of Statistics (NBS), food inflation has been one of the primary drivers, with staple items — rice, yam, tomatoes, cooking oil — recording year-on-year price increases that have outpaced wage growth for most households.
The naira, which traded at roughly ₦460 to the dollar as recently as mid-2023, has since depreciated dramatically following the removal of the Central Bank of Nigeria’s (CBN) managed exchange rate. By 2025, the naira has found a new — though still volatile — equilibrium in the ₦1,500 to ₦1,700 range at the official window.
Meanwhile, the Monetary Policy Rate (MPR) — the CBN’s benchmark interest rate — has been raised multiple times to combat inflation, making borrowing more expensive for businesses and individuals alike.
AfriPulse Take: These numbers are not just statistics. They represent the daily reality of millions of Nigerian families who are spending a larger proportion of their income on food, transportation, and utilities while wages have largely remained flat.
The Subsidy Removal: Painful But Necessary?
In May 2023, President Bola Tinubu announced the end of petrol subsidy payments — a policy that had cost Nigeria trillions of naira annually for decades. The rationale was straightforward: subsidy payments were consuming a massive share of government revenue, benefiting fuel smugglers and wealthy car owners disproportionately, while starving critical sectors like health and education of funding.
The consequences were immediate. Petrol prices rose from around ₦195 per litre to over ₦600 almost overnight, and in some states climbed even higher. Transportation costs surged, and since nearly every good in Nigeria is transported by road, the knock-on effect on food and commodity prices was severe.
More than two years on, the picture is mixed. The government has indeed freed up revenue that was previously swallowed by subsidy payments. But the promised social transfers and palliative programmes to cushion the impact on the poor have been slow, inadequate, or poorly targeted in many states.
AfriPulse Take: The subsidy removal was economically defensible. The implementation, and the social protection response, has left much to be desired. The burden has fallen most heavily on the urban poor and the middle class — the very people who cannot absorb such shocks easily.
The Naira: What Devaluation Really Means
The unification of Nigeria’s multiple exchange rates was long overdue. For years, the CBN maintained an artificial official rate while a parallel black market rate diverged wildly. This created perverse incentives — round-tripping, fuel subsidy fraud, import falsification — that drained foreign exchange reserves and enriched a small elite with access to official rates.
The new unified rate reflects closer to the market reality. But the pain of getting there is real. Imported goods — which Nigeria relies on heavily due to its underdeveloped manufacturing sector — now cost far more in naira terms. This includes not just luxury items, but medicines, machinery, spare parts, and raw materials for local factories.
For Nigerians in the diaspora, the weaker naira means remittances go further — a silver lining that has made Nigeria one of Africa’s top remittance-receiving nations, with inflows exceeding $20 billion annually. But for those earning in naira, purchasing power has eroded significantly.
AfriPulse Take: Currency devaluation was a necessary correction of a distorted system. The long-term benefit — attracting genuine foreign investment, ending round-tripping, improving the current account — is real. But the short to medium-term pain is borne by ordinary Nigerians, not the policymakers who designed the old system.
The Sectors Most Affected
Food and Agriculture
Nigeria’s food crisis is as much a structural problem as it is a currency problem. Insecurity in the food belt states — Benue, Plateau, Zamfara, Kaduna — has displaced farmers and reduced agricultural output. Meanwhile, the cost of fertiliser, which is partially import-dependent, has risen sharply. Until food production expands and supply chains are secured, food inflation will remain elevated regardless of monetary policy.
Manufacturing
Nigeria’s manufacturers have been squeezed from both sides: higher input costs due to naira depreciation and weaker consumer demand due to reduced purchasing power. Many have cut production or shut down operations. The Manufacturers Association of Nigeria (MAN) has repeatedly flagged these challenges to the federal government.
Real Estate and Construction
Property prices in Lagos and Abuja continue to rise in naira terms — but this reflects naira weakness more than genuine demand growth. Construction costs have spiked due to the high cost of imported materials. For the average Nigerian, home ownership has moved further out of reach.
Technology and Fintech
One of Nigeria’s genuine bright spots. The fintech sector — home to global names like Flutterwave, Paystack, and Moniepoint — has proven remarkably resilient. Mobile money adoption continues to grow, and Nigeria remains Africa’s largest startup ecosystem by funding. This sector offers real potential for job creation and foreign exchange earnings.
What the Government Is Doing — and What More Is Needed
The Tinubu administration has rolled out a series of economic initiatives including tax reforms, infrastructure investment pledges, and efforts to attract foreign direct investment. The Nigerian upstream oil sector has seen some recovery in production — a critical factor since oil revenues dominate government income.
However, several structural reforms remain incomplete or slow-moving:
- Power sector: Unreliable electricity continues to impose enormous costs on businesses and households. Without stable power, industrialisation is impossible.
- Security: Farmer-herder conflicts, banditry, and insurgency in multiple regions continue to disrupt economic activity and deter investment.
- Tax base expansion: Nigeria has one of the world’s lowest tax-to-GDP ratios. Widening the tax net — fairly and without further burdening the poor — is critical for sustainable government revenue.
- Education and healthcare: Years of underfunding have left both sectors in poor shape. Human capital development is the foundation of long-term economic growth.
What This Means for Ordinary Nigerians: AfriPulse Recommendations
While macroeconomic policy is beyond individual control, there are practical steps Nigerians can take to protect their financial wellbeing in this environment:
- Diversify income streams. Reliance on a single salary in a high-inflation environment is increasingly risky. Side businesses, freelancing, and skill development are more important than ever.
- Consider dollar-denominated savings carefully. While holding some savings in foreign currency is a reasonable hedge, ensure this is done legally through licensed platforms and within CBN guidelines.
- Reduce unnecessary imports. Supporting locally produced goods not only saves money but strengthens the local economy and reduces pressure on the naira.
- Engage with government processes. Economic policy is shaped by civic pressure. Nigerians must engage — through legitimate channels — to hold government accountable for the social protection promises made alongside painful reforms.
The Road Ahead: Cautious Optimism
Nigeria remains Africa’s largest economy and one of the continent’s most dynamic societies. Its demographic dividend — a young, entrepreneurial population — is a genuine asset if properly harnessed through investment in education, health, and infrastructure.
The reforms undertaken since 2023, painful as they are, were necessary corrections to a system that had become economically unsustainable. The test now is execution: whether the revenue freed up by subsidy removal is invested in public services, whether the unified exchange rate is maintained with discipline, and whether the security situation improves enough to unlock agricultural and industrial potential.
AfriPulse Daily will continue to track these developments, provide original analysis, and give Nigerians the context they need to understand the economic forces shaping their daily lives.
Have a perspective on Nigeria’s economy? We want to hear from Nigerian economists, business owners, farmers, and everyday citizens. Reach us at info@afripulsedaily.com or through our Contact Page.
Tags: Nigeria Economy, Inflation Nigeria 2025, Naira Exchange Rate, Petrol Subsidy Removal, CBN Monetary Policy, AfriPulse Analysis
