The World Bank has warned President Bola Tinubu-led Nigerian government not to reverse fuel subsidies and other economic reforms that have exacerbated the cost of living crisis.
The call comes in light of policy changes introduced by the Tinubu’s administration, including the removal of fuel subsidies and the abolition of multiple foreign exchange systems.
During the launch of the Nigeria Development Update (NDU) report in Abuja on Thursday, World Bank Country Director for Nigeria, Dr. Ndiame Diop, acknowledged that while these reforms may impose immediate hardships on citizens, they are essential for the country’s long-term economic stability.
Since the removal of the fuel subsidy, the price of petrol has surged from N198 to over N1,000 per liter.
Simultaneously, the naira’s value has plummeted, trading above N1,700 against the dollar in the parallel market, compared to below N600 prior to the reforms.
Despite the federal government’s defense of these policies, many Nigerians have expressed concerns about the escalating costs and their impact on daily life.
However, Diop cautioned that “reversing these reforms would be detrimental and would spell doom for Nigeria.”
Similarly, Finance Minister and Coordinating Minister of the Economy, Mr. Wale Edun, reaffirmed the federal government’s commitment to maintaining its reform agenda.
“Any effort that is not sustained will be a waste. Alongside the Governor of the Central Bank of Nigeria and the Minister of Budget and National Planning, we’ve been discussing how to stay on track, combat inflation, and ensure we move in the right direction.”
Edun elaborated that the government aims to reduce inflation while attracting investments in critical sectors such as industry, which will create jobs as the country anticipates significant investments in the near future.
This is not the first instance of the World Bank taking such a stance on Nigeria.
At the 30th Nigerian Economic Summit (NES30) in Abuja last week, the World Bank’s Senior Vice President and Chief Economist, Mr. Indermit Gill, urged the Tinubu administration to uphold ongoing reforms despite the prevailing hardships.
He stated that Nigeria needs the next 10 to 15 years to position itself as a leading economic power in sub-Saharan Africa and on the global stage.
However, Andrew Mamedu, Country Director of ActionAid Nigeria, criticized this perspective, calling the World Bank chief’s remarks insulting to the millions of Nigerians enduring unprecedented economic hardship.
