Time For a Socialist Alternative Now!
On May 29, 2025, President Bola Ahmed Tinubu would clock two years in office. In that space of time, his neo-liberal capitalist economic reforms have led to a destruction of livelihoods and the economy on a scale previously unimagined.
By H.T Soweto, lead article ‘Socialist Democracy’, May-June 2025 edition
For example, the pump price of petrol which Tinubu met at N197 per litre when he came to power on May 29, 2023 now hovers around N800 to N900 per litre – a marginal drop from its peak of around N1,100 per litre last year. The naira has also sharply depreciated from N463/$1 in early May 2023 to nearly N1600/$1 as at April 2025. Within the same period, headline inflation rate rose from 23% in April 2023 to 35% in December 2024 – the highest in the last three decades! On the same score, food prices are more than 80% higher than when the election was held.
These are the consequences of the IMF and World Bank neoliberal capitalist reforms, otherwise known as the “Renewed Hope Agenda”, that President Tinubu chose to implement as soon as he took power. In implementing these policies, Tinubu and the ruling All Progressive Congress (APC) had promised that they would lead to prosperity for Nigeria. Two years after, none of the promises has materialized. Instead, the neo-liberal reforms have resulted in greater inequality, hunger and deepening poverty.
TWO YEARS OF BLUNDER
Even from a capitalist point of view, Tinubu’s decision on May 29, 2023 to withdraw fuel subsidy and then shortly after, to devaluate the naira, is nothing short of a blunder. It is no hidden secret that crude oil is the elixir of Nigeria’s neocolonial economy. While only contributing between 5 to 10 percent to the overall GDP, it accounts for nothing less than 80% of national revenue and 90 percent of foreign exchange earnings. Everything – from economic production, to transportation, lighting of homes and offices as well as cooking – runs on affordable petrol and other derivatives from crude oil.
In the same vein, Nigeria’s currency devaluation is unarguably one of the largest adjustments anywhere in the world. Within a few weeks, the naira shed about 70% of its value. Only the Ethiopian currency, birr, has seen a bigger move recently. By tinkering with the oil subsidy which had kept fuel within affordable limits while also devaluing the naira, Tinubu opened the door to a catastrophe. Clearly Tinubu and the clique around him gambled that these moves would have a better outcome than the result of Buhari’s mixture of austerity and attempts to support different economic sectors.
However, the result of Tinubu’s neo-liberal policies is that high inflation, forex volatility and surging production costs have become the defining feature of the economy over the past two years. This has impacted Nigeria’s manufacturing sector causing a contraction. As data shows, the sector’s contribution to the GDP decreased from 8.42% in the third quarter of 2023 to 8.21% in the same period last year while the sector’s growth rate also slowed on the back of weakened consumer demand, escalating production costs, and declining purchasing power. This has forced several multinational firms to relocate out of the country even as others have closed shop. Indeed, an 87.5% surge of unsold inventory running into N2.14 trillion was recorded for the year 2024 compared to 2023, a report of the Manufacturer Association of Nigeria (MAN) has shown.
One of the consequences of naira devaluation is the improvement in Nigeria’s balance of payments as well as increase in national revenue. As the value of the currency has fallen, Nigeria’s dollar earnings from oil and gas sales, customs and excise duties, VAT and corporate income tax have all increased exponentially. This, together with the removal of oil subsidies, has caused a narrowing of Nigeria’s fiscal deficit from 6.4% of GDP in early 2023 to 4.4% in early 2024. Also, for the first time in many years, Nigeria’s has recorded a trade surplus while Nigeria’s foreign reserves now exceed $40 billion.
But these gains have been made at the cost of near destruction of the economy. As we write, more than half of Nigeria’s total Gross Domestic Product (GDP) has been wiped off over the past two years that Tinubu came to power. Despite the picture of growth that its naira-denominated variant portrays, the country’s GDP in dollar terms has actually declined from $363.82 billion in 2023 to $188.27 billion in 2025.
They are also unstainable gains. At some point, currency devaluation can result in an opposite effect one of which is encouraging capital flight in the form of companies and individuals finding ways to repatriate their wealth out of the country. Moreso, whatever macroeconomic stability has been achieved through the reforms now face headwinds from a global capitalist economy in turmoil.
WORLD ECONOMY IN TURMOIL
Since President Donald Trump came into power at the Oval Office in the US, his administration has become the great accelerator of all the contradictions of the global capitalist order. The developing trade war, provoked by Trump’s imposition of tariffs in April, has led to ripples in stock market and crash in crude oil price on the world market.
From its peak in January, Brent crude, the international oil benchmark, has dropped 19.31%. This poses grave consequence for commodity exporters like Nigeria. This explains why the International Monetary Fund (IMF) has now cut its growth forecast from Nigeria from 3.2% to 3%. This is expected to slow further to 2.7% next year. Although marginal, this speaks to the fragility of Nigeria’s economy two years into the reform.
Nigeria’s 2024 budget forecast oil at $75 a barrel but crude oil has slumped to around $66. One of the immediate impacts for Nigeria would be a decline in revenue. This will have the effect of reversing any gain in fiscal balance that the government reforms have reportedly achieved. The IMF estimates the country’s current account balance will shrink from 9.1% of GDP last year to 6.9 per cent in 2025.
This is on top of the warning by the US investment bank JP Morgan that Nigeria could slide into a current account deficit if the decline in oil prices is sustained. Lower oil price also means lower foreign exchange earnings. This will cause further instability in the foreign exchange market with the possibility of the dollar exchanging for as high as N2, 000 in a short period of time. Presently, the British pound has crossed the mark as it already exchanges for over N2, 000 to a naira.
Reduced revenue may also make it more difficult for Nigeria to service its existing debt, further straining its finances. As of March 2024, Nigeria’s total public debt stood at N121.67 trillion ($91.46 billion) – an increase of N24.33 trillion from December 2023. Debt servicing consumed 47%, N13.12 trillion, of the Federal Government’s total expenditure in the first nine months of 2024, highlighting the significant burden on the nation’s finances. Any significant shortfall in revenue therefore poses an even greater catastrophe than what has been experienced in the last two years.
GROWING INSECURITY
A feature of Tinubu’s two years in power is the regime’s cluelessness in the face of the growing insecurity across the country. Nigeria’s countryside, from the East to the North, is practically in a state of war.
In the North east of the country, Boko Haram and the Islamic State of West African Province (ISWAP) have increased their attacks. Their two-pronged assaults on military bases in Borno state and alongside Nigeria’s border with Cameroon between 24 and 25 March 2025 introduces a new frightening dimension to the conflict. Eye witness accounts suggest that the Islamist militants utilized armed drones in the attack. This could mark a new stage in a conflict that has lasted over ten years leading to about 30, 000 deaths while displacing about two million people.
In the Middle belt and towards the South, the violent actions of bandits and kidnappers have also continued. In the South East of the country, the agitation by the Indigenous People of Biafra (IPOB) as well as Eastern Security Network (ESN) has not abated. Curiously, the regime continues to hold the separatist leader, Nnamdi Kanu, in prison even when his continuous detention is a crucial element provoking the violence. Neither has the perennial violent conflict between herders and farmers stopped. This year has already witnessed a certain deterioration in the historical conflict over land and water resources. Alongside this is a high risk of a religious war breaking out due to how the violence is stoking religious sentiment.
Tension is high in most communities while security forces have been accused of failing to protect villagers from attacks. At least, 13,346 people were killed and over 9,207 abducted within the first one year of Tinubu’s administration. Sadly, the major conflict-zones are concentrated in states which account for most of Nigeria’s food production. Consequently, the rampaging insecurity is part of the major factors driving food inflation in the country.
WE CANNOT CONTINUE LIKE THIS
Despite all the movement in inflation, income growth for the rest of the working population remains weak reflecting limited gain in living standards over the past two years. From a GDP per capital of $2, 200 in 2022, Nigeria’s GDP per capita declined to $835 in 2025 highlighting how much toll Tinubu’s reforms have taken on the masses. In the same vein, wages have stayed abysmally low relative to the rate of inflation. Indeed, when the dollar value is considered, the current N70, 000 minimum wage negotiated by trade unions last year has the same purchasing power as Nigeria’s wage of N125 four decades ago!
Aside shelter, food and transportation are crucial elements of a workers’ wage. Yet these are sectors showing some of the highest inflation increase in price. While food have seen an 80% increase in prices in recent times, transport fares for interstate travel rose by 403.5%, airfares rose by 280.7% on the average while water transport fares also rose by 148.8 percent rise over the past two years. As a report by Business Day Newspaper shows, three out of ten workers allocate over 20% of their salary to transport costs while over 50% of Nigerians spend almost all of their income on food alone.
The result is an ever-expanding arc of misery for the working masses and the poor. Indeed, some families now go without food as they cannot afford to have three square meals in 24 hours. Yet, a few billionaires have seen their wealth increase exponentially within the past two years showing the pro-rich character of Tinubu’s reforms. According to Forbes, billionaire Aliko Dangote has seen his wealth nearly double from $13.4 billion last year to $23.9 billion in January 2025, which ranks the Nigerian entrepreneur as the wealthiest person in Africa and 86th in the world. Three other billionaires, Mike Adenuga, Abdulsamad Rabiu, and Femi Otedola, have seen their wealth increase in the same manner.
Their combined wealth, derived from inheritance, monopoly power, and cronyism, is valued at $23.7 billion. This is an amount so vast that, according to Oxfam, it could easily cover the whole of Lagos city in 500-naira notes. In fact, Aliko Dangote alone could spend N1 million daily for 42 years without depleting his fortune! Meanwhile, over 133 million Nigerians, around 70% of the population, are struggling with hunger while thousands are dying because they cannot afford hospital bills.
Faced with an economic policy that is not working increasingly Tinubu’s answer to both insecurity and opposition is repression. But this will not work because Tinubu’s regime is both a defendant and servant of the capitalist system whose failures are at the root cause of the issues. With the majority facing falling living standards while the multi-millionaire Tinubu regularly takes ‘working’ holidays in Europe resentment can only grow. Tinubu knows that under nine million actually voted for him and now he is fearful of the tens of millions of Nigerians that don’t support him, hence repression of protesters and suppression of music critical of him.
WHAT NEEDS TO BE DONE
165 years ago, Karl Marx noted that “there is something rotten in the very the core of a society that increases its wealth without diminishing its misery”. The extreme wealth inequality which are the result of Tinubu’s neoliberal economic reforms of the past two years is not only an indictment of Tinubu himself, it is also an indication that capitalism is broken and need to be replaced.
This raises the question as to whether there is no other way of running Nigeria other than the corruption, cronyism, exploitation and repression that have been the defining feature of governance over the past 6 decades. There is actually another way. That is through the Socialist reconstruction of Nigeria. This would require the working class coming to power and nationalizing the commanding heights of Nigeria’s economy like the oil and gas firms, big monopoly companies and banks and their placement under workers democratic control and management. Such a step backed by a socialist plan of development can begin to ensure that Nigeria’s economy is run to meet the needs of the people instead of the greed of a few billionaires.
It is also under such an arrangement that Nigeria’s insecurity can be tackled through the democratic resolution of the National Question which is a crucial factor behind the cacophonic agitations across the country.
To achieve this however means that the working people, youth, trade unions and pro-masses organisations have to step up the struggle against Tinubu’s anti-poor policies, for a living minimum wage, against repression while starting the crucial work of building a political vehicle, a mass workers party on a socialist program, to begin to fight to wrest political power from the hands of the capitalist gangsters holding the country to ransom and begin the socialist reconstruction of Nigeria.
Nigeria Solidarity 