Nigeria’s Recovery Real but Fragile, Report warns of lost decade

By Kazeem Ugbodaga

Nigeria’s economy may be showing early signs of recovery after years of turbulence, but its growth remains fragile and far from transformative, according to the Quartus Economics Team in its October 2025 Independent Economic Review.

The report traces Nigeria’s economic journey over the last four decades, beginning with the Structural Adjustment Programme (SAP) of 1986, a reform initiative designed to reduce state control, liberalise trade, and promote private-sector-led growth.

Although the programme expanded the nation’s GDP from $87.5 billion in 1990 to nearly $252 billion by 2024, the country’s economic structure, Quartus noted, “remained fragile,” with the naira losing 99.7 per cent of its value over the period.

According to the economists, while early liberalisation and banking reforms in the 1990s and early 2000s spurred private investment and industrial expansion, the failure to sustain reform momentum, coupled with policy reversals and weak implementation, reversed many of these gains.

“Policy inconsistency became Nigeria’s biggest economic tax,” the report stated, adding that the country repeatedly missed opportunities to achieve export-led, inclusive growth.

The review described the period between 2014 and 2023 as Nigeria’s “lost decade,” marked by the collapse of oil prices, stunted industrialisation, surging inflation above 30 per cent, and declining capital inflows. During this period, per capita GDP fell by 66 per cent from its 2014 peak, while over 65 million Nigerians slipped into poverty.

However, the report acknowledged a turning point in 2023–2024, when the government removed fuel and foreign exchange subsidies, reforms it described as “decisive and necessary.”

Though the immediate effects included inflationary shocks, the measures corrected long-standing distortions that had drained public finances and discouraged productive investment.

By 2024, early signs of stabilisation began to emerge: the economy expanded by nearly 4 per cent, the manufacturing and mining sectors returned to growth, and for the first time in years, GDP growth outpaced population growth.

The naira gained modest stability, inflation began to ease, and by October 2025, foreign reserves rose to $42 billion, reflecting a gradual return of investor confidence.

Yet, Quartus Economics cautioned that Nigeria’s economic recovery remains “real but not yet resilient.”

The report warned that per capita income remains well below pre-crisis levels, while the country’s export base is still narrow and public-sector inefficiencies persist.

To achieve long-term transformation, the report urged Nigeria to move “from stabilisation to structural transformation” by deepening market reforms, improving productivity, promoting enterprise-led growth, and dismantling what it described as the “locust culture” that drains public resources.

“Nigeria, the African eagle, is unstuck, yet it has not begun to soar,” the report concluded.

“Its recovery is genuine, but the strength of its flight will depend on discipline, policy continuity, and collective resolve to earn an enduring transformation,” the report added.