Nigeria at the crossroads: a roadmap for economic recovery, B

As Nigeria navigates the turbulent waters of 2026, the debate in boardrooms, markets and households across the country has shifted from despair to cautious hope. Macroeconomic indicators are finally showing signs of life, inflation is declining, the naira has found some stability and international institutions such as the IMF and the World Bank are predicting GDP growth of around 4.4% for the year. However, for the average Nigerian struggling with the cost of food, transportation and basic necessities, these numbers seem distant and abstract. The real question is whether recovery will be possible. Here’s what the government needs to do to ensure that growth translates into tangible relief for its citizens.

The first and most urgent priority is fiscal discipline. Nigeria’s 2026 budget, valued at more than 58 trillion naira, allocates nearly half of projected revenue to debt servicing, a staggering burden that leaves little room for investment in infrastructure, education or healthcare. If the government is serious about turning the economy around, it must face this reality head on. This means not only improving revenue collection through recently enacted tax reforms, but also making tough choices about spending priorities. PwC experts have warned that pre-election pressures could lead officials into excessive spending that fuels inflation without delivering results. Government must resist this temptation and instead focus on the efficient execution of existing budgets, ensuring that every naira allocated for capital projects actually reaches its intended destination.

Monetary policy must also play a more intelligent and coordinated role. The Central Bank of Nigeria has taken commendable steps by cutting the monetary policy rate and signaling a shift towards an inflation targeting framework. But interest rates remain high and access to credit for small and medium-sized businesses, which form the backbone of the Nigerian economy, remains painfully limited. The CBN should work more closely with commercial banks to design targeted lending programs that support productive sectors such as agriculture and manufacturing, rather than allowing liquidity to flow primarily into speculative activities. At the same time, the bank must remain vigilant about the money supply, especially because election cycles historically trigger inflationary spending.

Diversification cannot remain a slogan; it must become a strategy. For decades, Nigeria has talked about reducing its dependence on oil, but the commodity still dictates the nation’s fiscal fortunes. With global oil prices expected to decline in 2026 due to oversupply, the urgency to build a resilient non-oil economy has never been greater. This requires more than just rhetoric. The government must invest in the infrastructure that allows other sectors to thrive: reliable electricity, functional transport networks and digital connectivity. The digital economy already contributes almost 19% to GDP and, with the right policy support, clear regulations, investment in broadband and skills development, it could become an even more powerful driver of job creation and export earnings.

Agriculture offers another huge opportunity, but only if approached with modern thinking. Nigeria has the land, labor and climate to feed itself and export surpluses. However, post-harvest losses remain catastrophic and farmers struggle to access quality seeds, fertilizers and markets. The government should prioritize investments in storage facilities, cold chain logistics and agricultural processing zones. Reviving marketing boards focused on fair prices and offtake guarantees could stabilize rural producers’ incomes while ensuring food security for urban consumers. Crucially, these efforts must be inclusive, deliberately empowering the women and youth who dominate the informal agricultural sector and account for a significant share of employment.

Security remains a huge challenge. No economic policy can succeed if farmers cannot access their fields, trucks cannot move goods safely, or investors fear for their physical safety. Continued insurgency in the North East, banditry in the North West and communal conflicts in the Central Belt have displaced millions and paralyzed agricultural production, directly fueling inflation. The establishment of the state police, a reform long debated but never implemented, could bring security closer to the communities that need it most. The federal government must also address the root causes of civil unrest, poverty, unemployment and perceived marginalization through targeted development programs that offer young people alternatives to violence.

Transparency and accountability are not just moral imperatives; they are economic necessities. Nigerians are understandably skeptical of government promises, having witnessed decades of grand plans that have delivered little or nothing. The recent controversy over gazetted tax reform laws illustrates how quickly public trust can erode when communication is poor or processes appear opaque. The government must prioritize clear and consistent messaging on its policies, invite constructive feedback from civil society and the private sector, and demonstrate results through measurable outcomes. When citizens see that their taxes fund better roads, functioning schools, or reliable electricity, compliance will increase organically.

Social protection must accompany structural reforms. Economic transitions are painful, and the most vulnerable should not bear the brunt of them. While the elimination of fuel subsidies was economically rational, the resulting price shocks hit low-income families hardest. The government should expand targeted cash transfer programs, expand access to affordable healthcare, and invest in education and vocational training to equip Nigerians for the jobs of the future. As Chinwe Egwim of the World Economic Forum noted, growth that falls short of baseline is not sustainable growth.

Finally, Nigeria must leverage its regional leadership. As Africa’s largest economy and most populous nation, Nigeria’s stability has continental implications. The government should support regional integration through the African Continental Free Trade Area, allowing Nigerian businesses to access larger markets. It should also work with neighboring countries on shared challenges such as cross-border security, climate resilience and infrastructure development. A stronger West Africa is a stronger Nigeria.

The path ahead is neither simple nor short. Nigeria’s economic recovery will require patience, persistence and political courage. The resources for success are at hand: a young and dynamic population; abundant natural resources; a vibrant private sector; and a growing consensus on the need for reform. What is missing is not a project but the will to implement it coherently. If the government can align its policies, coordinate across institutions, and keep the well-being of Nigerian citizens at the center of its decisions, 2026 could indeed mark the turning point from risk to recovery. The world is watching, but more importantly, the Nigerian people are waiting. Their patience, while notable, is not infinite. The time for decisive and compassionate action is now.

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