Nigeria’s economy is showing signs of recovery, but millions of households remain trapped in hardship. As the 2027 elections approach, economists at the sixth DataPro International Credit Rating Webinar examined whether the country’s reforms can survive political change without delivering meaningful relief to citizens. Festus Akanbi reports

Nigeria’s economy is growing, foreign reserves are improving, and investor confidence is gradually recovering. Yet, behind these encouraging figures lies a troubling reality: millions of Nigerians can barely afford food, transport and other necessities. While economic indicators suggest recovery, household incomes remain under pressure, raising questions about who is benefiting from the reforms.

This contradiction presents a formidable political challenge ahead of the 2027 general elections. Can President Bola Tinubu’s administration sustain policies that have improved economic stability but deepened financial pressures on households? Would those policies survive a change in government?

These questions featured prominently at the sixth DataPro International Credit Rating Webinar, held on October 8, 2026.

Professor Kai Gehring of the University of Bern, Switzerland, argued that Nigeria’s greatest challenge was no longer introducing reforms but ensuring their survival beyond electoral cycles.

He observed that countries attaining investment-grade sovereign ratings generally maintained economic reforms over long periods, while unsuccessful countries frequently reversed policies after political transitions.

According to him, Nigeria needs persistence, not repeated policy changes.

For investors, the concern extends beyond the present administration. They want assurances that policies supporting debt repayment, revenue mobilisation and economic stability will survive future elections.

Growth Amid Hardship

Nigeria’s reform programme gathered momentum in May 2023 with petrol subsidy removal. Foreign exchange liberalisation followed, alongside monetary and fiscal adjustments.

In its June 2026 assessment, the International Monetary Fund (IMF) acknowledged improvements in macroeconomic stability, external reserves and foreign exchange operations.

The Fund estimated economic growth at four per cent in 2025 and projected 4.1 per cent for 2026.

However, the recovery has not eliminated hardship.

The IMF estimated that 63 per cent of Nigerians lived below the national poverty line, while approximately 27 million experienced food insecurity towards the end of 2025.

Similarly, the World Bank’s April 2026 Nigeria Development Update acknowledged improving economic conditions but warned that household incomes had not fully recovered.

These findings highlight the challenge policymakers face. Economic recovery means little to struggling households unless it improves purchasing power.

The Danger of Policy Reversal

Gehring warned that reforms lacking public acceptance could become casualties of electoral politics.

He explained that a new administration might face pressure to restore petrol subsidies if voters continued associating their removal with hardship.

“The countries that managed to get to investment grade, it is mostly a story about persistence,” he said during the webinar.

He stressed the importance of securing support across political parties, regions and social groups.

“The broader the support these reforms can have, the better,” he added.

According to Gehring, investors assess whether governments can sustain reforms over several years, particularly when purchasing long-term sovereign bonds.

He estimated that Nigeria remained approximately six or seven rating notches below investment-grade status.

Improvements in security, revenue mobilisation and transparency could strengthen its creditworthiness, although he described the potential rating gains as illustrative estimates.

Institutions Beyond Personalities

Professor Torsten Schmidt of the University of Duisburg-Essen, Germany, identified institutional development as essential to sustainable reforms.

He emphasised stronger revenue collection, education and transparent public administration.

“You have to make the public sector more rule-based and more transparent,” he told participants.

Schmidt stressed that governments must publish reliable budgetary information and clearly communicate borrowing plans.

According to him, sovereign ratings fundamentally assess a government’s willingness and ability to repay debt.

Gehring similarly identified central bank independence as a safeguard against political interference.

He cited Norway’s petroleum revenue management framework, under which oil revenues are channelled into a sovereign wealth fund governed by fiscal rules.

Although Nigeria’s circumstances differ, the example demonstrates how strong institutions can protect economic policies from political pressures.

Investor Confidence and Economic Transformation

Founder of DataPro Limited, Mr. Abimbola Adeseyoju, placed the debate within Africa’s broader struggle to attract affordable long-term capital.

Speaking at the webinar, Adeseyoju declared: “Credit ratings are no longer merely passive measures of risk; they have become catalysts for economic transformation.”

He explained that sovereign ratings influence investment flows, borrowing costs and governments’ capacity to finance infrastructure and industrialisation.

According to him, African countries must strengthen fiscal discipline, deepen domestic capital markets and improve transparency.

Adeseyoju also called for credit rating methodologies that reflect Africa’s economic realities without overlooking investment risks.

He maintained that Africa’s journey towards investment-grade status required “deliberate, consistent policy implementation, sound market infrastructure, and robust cross-border collaboration.”

His position reinforced concerns that policy reversals could weaken investor confidence and increase borrowing costs.

The Social Cost

Organised labour’s concerns highlight the political risks tied to economic hardship.

In a September 30 statement, Nigeria Labour Congress President Joe Ajaero warned that inflation and rising petrol prices had weakened workers’ purchasing power.

“We stand at the crossroads of a full-scale survival crisis,” he declared.

The NLC demanded relief from rising petrol prices, improved wages and accountability for subsidy savings.

Manufacturers Expressed Similar Concerns

The Director-General of the Manufacturers Association of Nigeria, Segun Ajayi-Kadir, acknowledged that reforms had established foundations for recovery but maintained that manufacturers had borne disproportionate adjustment costs.

The association identified expensive credit, energy costs and exchange rate pressures as major obstacles to production.

Government’s Fiscal Challenge

At the webinar, Dr Doris Uzoka-Anite, represented by Statistician-General Prince Adeyemi Adeniran, outlined plans to strengthen Nigeria’s public finances.

Under the proposed National Development Plan 2026–2030, government revenue is projected to increase from 11.15 per cent of GDP in 2025 to 18.70 per cent by 2030.

The debt-service-to-revenue ratio is also projected to decline from approximately 62.9 per cent to 21.01 per cent.

Achieving these targets will require effective tax administration, expenditure discipline and sustained growth.

The IMF’s 2026 assessment raised concerns that estimated petrol subsidy savings, potentially worth two per cent of GDP, had not fully accrued to the federal budget in 2025.

The finding underscores the importance of transparency in managing reform benefits.

Beyond the Ballot

The 2027 elections will test Nigeria’s ability to preserve economic reforms while improving living standards.

For Gehring, successful economic transformation requires persistence, credible institutions and broad public support.

For Adeseyoju, stronger creditworthiness depends on consistent policies and investor confidence.

Ultimately, Nigeria’s challenge is to ensure that economic stability translates into tangible benefits for citizens.

Whether that happens before the elections may determine whether today’s reforms survive tomorrow’s political transitions.