…Insists FG has supported over 10 million vulnerable Nigerians

The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has admitted that the sequencing of fuel subsidy removal and foreign exchange (FX) market liberalisation was fast.

He said the timing of the reforms triggered a sharp increase in fuel prices shortly after President Bola Tinubu assumed office in 2023.

Oyedele stated this at Africa’s Golden Future, an event held on the sidelines of the ongoing International Monetary Fund (IMF)/World Bank Annual Meetings in Bangkok, Thailand.

At his inauguration on May 29, 2023, President Tinubu announced the removal of fuel subsidy, a decision many considered hasty.

In June, the Central Bank of Nigeria (CBN) followed up with the floating of the naira and the introduction of a largely market-driven foreign exchange trading regime.

The twin policies triggered an almost 300 per cent increase in fuel prices, with knock-on effects on the cost of living. This raised concerns about the pace and sequencing of the reforms.

Oyedele, who spoke on a panel alongside the President of the African Development Bank (AfDB), Dr Sidi Ould Tah, among others, highlighted the importance of fuel, FX market and tax reforms but admitted that the sequencing of the first two was “quick anyway”.

The minister acknowledged the costs of the reforms but insisted that partial implementation would deliver the pain without the gains.

The IMF had previously argued that the negative effects of the Structural Adjustment Programme (SAP), which many continue to blame for the naira’s woes, were partly attributable to its incomplete implementation.
Oyedele also stressed the importance of communication during reforms, urging other African countries to follow Nigeria’s path even when people do not “believe you”.

He claimed that Nigeria had supported more than 10 million vulnerable people, stressing that other countries could replicate the country’s reform experience.

Earlier in the day, at a G-24 press conference, Oyedele described macroeconomic stability as the foundation for structural growth.

He insisted that the two objectives were not mutually exclusive, arguing that stability was an important foundation for achieving structural growth.

He also said debt sustainability remained a critical issue. According to him, countries must leverage debt to fund critical infrastructure and ensure that borrowing delivers value for money and supports future growth.
Responding to a question on the trade-off between debt and tax financing, Oyedele said “people” must be at the heart of policy choices.

The Director of the G-24, Iyabo Masha, aligned with Oyedele, saying countries must achieve macroeconomic stability before pursuing structural growth.