The country’s economic reforms may be repairing the balance sheet. But until Nigeria repairs its productivity problem, growth will remain a number on a spreadsheet while prosperity remains a promise.
By Jude Dike, PhD
There is a peculiar moment in Nigerian economic life when the country can be told that things are getting better. At the same time, the Nigerian can be forgiven for asking: “Better for whom?”
The naira is more stable. Foreign reserves are stronger. Government revenues are improving. Investors are showing renewed interest. Oil production has recovered. Inflation has moderated sharply from its 2024 heights.
Nigeria’s real GDP grew 3.89 percent year-on-year in the first quarter of 2026, compared with 3.13 percent a year earlier. PwC expects the economy to grow by about 4.2 percent this year. Moody’s has just revised Nigeria’s sovereign outlook from stable to positive, citing stronger external buffers and economic resilience.
And yet a Nigerian household can look at all of this and say: “I am still struggling.”
That is not economic illiteracy. It is the central economic question Nigeria has not adequately answered.
The country is beginning to stabilize its macroeconomy. But it has not yet demonstrated that it can reliably improve the microeconomy of the Nigerian household.
And that distinction may determine whether the current reform programme becomes a historic economic turnaround or merely another period in which Nigeria’s statistics improved while Nigerians remained poor.
The question nobody is asking loudly enough is not: How fast is Nigeria growing?
It is: How much more productive is the average Nigerian becoming?
That is where the real story begins.
The Subsidy Argument Has Been Asking the Wrong Question
Nigeria has spent the past three years arguing about petrol as though petrol were the economy. The removal of the petrol subsidy was necessary, its defenders argue. It was fiscally unsustainable.
Its critics respond that it destroyed household purchasing power. The government says the savings can be redirected toward infrastructure and social investment.
Critics say Nigerians cannot eat fiscal savings.
One side says: “The reform is working.”
The other says: “Nigerians are suffering.”
Both can be right. That is the uncomfortable part.
A government can improve its fiscal position while households become poorer in real terms. A central bank can stabilize the foreign-exchange market while families cut meals. GDP can grow while the quality of employment deteriorates.
There is no contradiction. There is a missing transmission mechanism.
How does macroeconomic stabilization become household prosperity?
That is the question Nigeria should now be debating. Because a healthier government balance sheet is not itself a higher household income. A stronger naira is not itself a better-paying job. More foreign reserves are not themselves a productive factory. Higher oil production is not itself economic diversification. And GDP growth is not necessarily prosperity.
The World Bank made this warning precisely in its October 2025 Nigeria Development Update: the country had made notable progress in fiscal, monetary and trade reforms, but the gains had not yet significantly improved living standards, with food inflation and poverty remaining high.
That is the gap. And it is enormous.
Nigeria Can Grow and Still Make Its People Poorer
Here is the paradox.
Nigeria is not a country without resources.
It has oil and gas.
It has enormous agricultural potential.
It has one of the world’s largest young populations.
It has a huge domestic market.
It has entrepreneurs operating everywhere from Aba to Kano, Lagos to Kaduna, Ibadan to Onitsha.
It has a rapidly expanding digital economy.
It has world-class creative talent.
It has mineral resources.
It has a strategic position in Africa.
And it has a population of roughly 238 million people, according to the World Bank’s latest data.
Nigeria’s problem is therefore not simply the absence of wealth.
It is the country’s inability to convert its resources, people and capital into high-productivity economic activity at sufficient scale.
This is the distinction we routinely miss.
A woman who spends twelve hours selling goods in a roadside stall is working.
A young man driving a motorcycle for twelve hours is working.
A farmer cultivating two hectares with minimal mechanization is working.
A graduate selling imported products through Instagram is working.
A carpenter operating with unreliable electricity is working.
A small manufacturer running a generator for much of the day is working.
But being employed is not the same thing as being economically productive.
Nigeria’s labour statistics make this painfully clear.
The National Bureau of Statistics reported that 93 percent of employment was informal in the second quarter of 2024, up from 92.7 percent in the previous quarter.
The significance of that number goes far beyond whether a worker has a tax identification number.
Informality often means limited access to finance, little social protection, weak access to technology, low capital intensity, minimal economies of scale and enormous vulnerability to economic shocks.
The World Bank has previously found that roughly 85 percent of Nigerian workers were engaged in household farms or non-farm household enterprises, while only about one in 10 were wage-employed. It described many household enterprises as extremely small-scale and characterized by low productivity.
This is the economic trap.
Millions of Nigerians are working. But too many are working in activities that cannot generate enough value to make them prosperous.
The Problem Is Not That Nigerians Don’t Work Hard
This needs to be said explicitly.
Nigeria does not have a laziness problem.
It has a productivity problem.
The Nigerian worker frequently works extraordinarily hard under extraordinarily inefficient conditions.
Consider the electricity problem.
When a manufacturer must provide its own power, the generator becomes part of the production process.
When a restaurant spends heavily on diesel, the generator becomes part of the cost of a meal.
When a barber buys fuel to run a generator, electricity becomes part of the price of a haircut.
When a farmer spends hours transporting produce over bad roads, transportation becomes part of the price of food.
When a business pays multiple informal charges simply to move goods through checkpoints, those charges become part of the cost of production.
When insecurity prevents a farmer from reaching his farm, the price is eventually paid by the consumer in the market.
Nigeria has therefore created an extraordinary phenomenon:
The Nigerian worker often pays for the failure of the system through his own productivity.
The World Bank has repeatedly identified unreliable electricity as a major constraint on Nigerian businesses. Its research has estimated the economic losses associated with inadequate power at billions of dollars annually.
This is why productivity cannot be treated as an abstract economist’s word.
Productivity is the difference between a worker producing ₦10,000 of value in a day and producing ₦50,000.
It is the difference between a farmer selling raw cassava and a company processing cassava starch for export.
It is the difference between a tailor working alone and a garment manufacturer employing 500 people.
It is the difference between exporting crude oil and exporting refined petroleum products and petrochemicals.
It is the difference between a graduate searching for a job and a technology company creating thousands of globally competitive digital jobs.
Productivity is ultimately about how much value Nigeria can create from each hour of Nigerian effort.
And Nigeria has not been creating enough.
The Small-Business Trap
Now consider Nigeria’s celebrated entrepreneurial spirit.
We often congratulate Nigerians for being entrepreneurs.
But there is a darker side to that celebration.
Sometimes “entrepreneurship” is simply what unemployment looks like when a person refuses to give up.
A woman who sells provisions from her sitting room is an entrepreneur.
But what if she would rather work for a company that paid her ₦500,000 a month?
A graduate who becomes a ride-hailing driver is an entrepreneur.
But what if his real ambition is to become an engineer?
A man selling phone accessories on a street corner is an entrepreneur.
But what if he could instead work in a factory producing the phones or their components?
Nigeria has become remarkably good at absorbing people into survival activities.
It has been much less successful at moving people into productive enterprises that can scale.
That is why the size of the informal economy matters.
An economy can have millions of businesses and still have too few businesses capable of becoming medium-sized or large employers.
And scale matters.
A one-person enterprise cannot usually provide the productivity, training, capital accumulation and technological diffusion generated by a company employing 1,000 people.
This is one reason PwC’s latest outlook is so important. It notes that domestic private-sector credit is only 21.3 percent of GDP, compared with a sub-Saharan African average of 33 percent, and identifies access to finance as a major constraint on MSME expansion.
Nigeria does not merely need more entrepreneurs.
It needs more entrepreneurs who can scale.
That is a radically different policy objective.
The Cost of Capital Is Quietly Killing the Future
Nigeria’s debate about poverty often focuses on what government should give households.
We need to ask another question:
What is preventing Nigerians from creating more wealth themselves?
One answer is the cost of capital.
A young Nigerian with a viable business idea can face financing costs that make expansion almost impossible.
The small manufacturer cannot buy machinery.
The farmer cannot mechanize.
The technology company cannot hire aggressively.
The retailer cannot open another branch.
The exporter cannot build processing capacity.
The result is an economy full of businesses permanently trapped at the survival stage.
That is why the question of credit is really a question about national productivity.
Cheap credit alone will not solve Nigeria’s problems. But an economy in which productive businesses cannot obtain affordable long-term capital cannot undergo sustained structural transformation.
PwC’s latest assessment therefore recommends targeted credit windows, partial credit guarantees and blended-finance structures alongside broader improvements in the macroeconomic environment.
This is where Nigeria must become more sophisticated.
The goal should not be to subsidize consumption indefinitely.
It should be to lower the cost of producing the things Nigerians consume and the things the world will buy from Nigeria.
That is a very different philosophy.
Agriculture: Where Millions Work and Too Little Value Is Created
Nigeria’s agricultural problem illustrates the productivity paradox perfectly.
We frequently say agriculture is the answer to food insecurity and unemployment.
But agriculture cannot become transformative merely because millions of people are farming.
The question is:
How much value does each farmer generate?
A farmer producing raw commodities at low yields, transporting them over poor roads and selling immediately after harvest to meet urgent cash needs is vulnerable at every stage.
The farmer lacks storage.
The farmer lacks affordable credit.
The farmer lacks irrigation.
The farmer lacks mechanization.
The farmer lacks market information.
The farmer lacks processing capacity.
And often the farmer lacks security.
So Nigeria imports processed food while exporting commodities that could have been processed domestically.
The country therefore loses value twice:
First, at the farm gate.
Then again when it imports the higher-value product.
The solution is not simply “more farming.”
It is more productive farming connected to processing, logistics, finance, technology and export markets.
That is what structural transformation looks like.
Education Has Become a Credential System Without a Productivity System
There is another uncomfortable truth.
Nigeria has spent decades treating education primarily as a pathway to certificates.
But an economy does not become more productive because its citizens possess more certificates.
It becomes more productive when people acquire skills that enable them to create more value.
A country can produce thousands of graduates every year and still have a shortage of:
- skilled technicians;
- machine operators;
- software engineers;
- electricians;
- welders;
- data specialists;
- construction professionals;
- industrial managers;
- agronomists;
- healthcare technicians; and
- logistics specialists.
This is why the skills question must be brought into the productivity debate.
The World Bank has repeatedly identified human capital and job creation as central to Nigeria’s development challenge. Its earlier labour-market research warned that Nigeria’s growth was producing a divided economy: a small portion of workers gaining access to higher-productivity opportunities while many remained trapped in low-productivity activities.
The implication is profound.
Nigeria does not merely need more educated people. It needs an economy capable of productively employing educated people.
Otherwise, education becomes a waiting room.
The Population Dividend Could Become a Population Tax
Nigeria’s greatest potential advantage is also becoming one of its greatest tests.
The country has a huge and rapidly growing population.
That can be an extraordinary economic asset.
More consumers create a larger domestic market.
More workers create a deeper labour pool.
More entrepreneurs create more potential businesses.
More young people create more opportunities for innovation.
But there is a condition:
They must become more productive faster than the population grows.
Otherwise, population growth magnifies poverty.
The World Bank estimates Nigeria’s population at about 237.5 million in 2025, growing at roughly 2.1 percent annually.
That means Nigeria cannot be satisfied with growth of around 4 percent if the quality and distribution of that growth are weak.
Four percent GDP growth sounds respectable.
But the policy question is:
How much of that growth becomes higher income per person?
And more importantly:
How much becomes higher income for the bottom half of society?
Those are different questions from GDP growth.
This Is Why GDP Can Lie Without Actually Lying
GDP is not the villain.
It is simply being asked to answer a question it was never designed to answer.
GDP measures economic activity.
It does not tell us whether a young graduate can find a good job.
It does not tell us whether a family can afford protein.
It does not tell us whether a small manufacturer can operate for 24 hours.
It does not tell us whether a farmer can transport tomatoes to market before they spoil.
It does not tell us whether a nurse can afford housing near her workplace.
It does not tell us whether a business can obtain a five-year loan at a rate that allows it to invest.
GDP can rise while these things deteriorate.
And that is why Nigeria’s current economic moment deserves neither blind optimism nor reflexive pessimism.
The macroeconomic improvement is real.
So is the household pain.
Moody’s recognition of stronger external resilience and the World Bank’s projection of continued growth are important. So is the World Bank’s estimate that an additional 7 million Nigerians fell into poverty in 2025, taking the estimated share below the national poverty line to 63 percent.
Both facts can coexist.
Indeed, understanding why they coexist may be the most important economic exercise Nigeria undertakes.
The Missing Middle: From Reform to Productivity
This brings us back to subsidy removal.
The reform was essentially a fiscal and allocative reform.
The harder reform is now staring Nigeria in the face:
How do we convert fiscal space into productive capacity?
If subsidy savings improve government finances, what happens next?
Do they disappear into recurrent expenditure?
Do they finance infrastructure?
Do they lower the cost of logistics?
Do they improve electricity?
Do they finance skills?
Do they crowd in private capital?
Do they make Nigerian firms more competitive?
Do they help farmers move into commercial agriculture?
Do they build industrial corridors?
Do they create export capacity?
Do they expand mass transit?
Do they improve ports?
Do they reduce the cost of broadband?
Do they make Nigerian cities more productive?
This is the missing link.
Fiscal reform is not the destination. It is the beginning.
A government can balance its books and still have an unproductive economy.
The ultimate test is whether the reform creates an environment in which a Nigerian can produce more, earn more and accumulate more wealth.
Stop Asking How to Make Nigeria Cheaper
This may sound strange after years of inflation.
But Nigeria’s long-term economic strategy cannot simply be:
“How do we make everything cheaper?”
There is a more powerful question:
“How do we make Nigerians richer?”
The distinction matters.
If food is cheaper because farmers are more productive, that is sustainable.
If electricity is cheaper because the power system is more efficient, that is sustainable.
If transportation is cheaper because logistics infrastructure improves, that is sustainable.
If housing is cheaper because land, finance and construction become more efficient, that is sustainable.
If wages rise because workers become more productive, that is sustainable.
But if prices are suppressed indefinitely without improving productivity, the government eventually pays the bill.
Nigeria has repeatedly tried to make the symptoms cheaper without fixing the production system underneath them.
That is why the subsidy debate keeps returning in different forms.
The Policy Revolution Nigeria Actually Needs
The next phase of Nigeria’s reform programme should therefore be measured by a different scoreboard.
Not merely:
GDP growth.
But:
GDP per worker.
Not merely:
foreign reserves.
But:
private investment per worker.
Not merely:
number of jobs created.
But:
number of productive jobs created.
Not merely:
number of MSMEs registered.
But:
number of MSMEs that survive, scale and employ others.
Not merely:
kilometres of roads constructed.
But:
how much those roads reduce the cost and time of moving goods.
Not merely:
megawatts generated.
But:
reliable electricity delivered at a competitive price to productive users.
Not merely:
graduates produced.
But:
graduates employed in high-productivity activities.
And not merely:
poverty programmes funded.
But:
households that permanently graduate from poverty because their incomes increased.
This would represent a profound change in Nigerian economic policy.
It would move the country from redistribution of scarcity to production of abundance.
The Question That Should Haunt Every Nigerian Policymaker
Nigeria has spent decades asking:
How much money does government have?
Then:
How much revenue can government collect?
Then:
How much can government borrow?
Then:
How much subsidy can government afford?
Then:
How much should government spend?
All of these questions matter.
But they are subordinate to a larger question:
How much value can Nigeria’s 200-million-plus people produce if the economy finally gets out of their way?
That is the question nobody is saying loudly enough.
Because if Nigerians become significantly more productive, the country gets something subsidies can never provide:
permanent purchasing power.
A productive farmer does not need food subsidy forever.
A productive worker does not need transport subsidy forever.
A profitable manufacturer does not need the government to create his job.
A competitive exporter does not need government to protect him indefinitely.
A skilled young person earning a global income does not need a government grant to survive the month.
This is the real meaning of economic empowerment.
Not making Nigerians permanently dependent on a cheaper economy.
Making Nigerians capable of earning more in a richer one.
Nigeria’s Next Reform Must Be a Productivity Reform
The first reform question was:
Can Nigeria afford the way it was spending money?
The next question must be:
Can Nigeria afford the way it is producing wealth?
That is much more difficult.
It requires confronting electricity.
Education.
Security.
Transport.
Tax complexity.
Access to finance.
Land.
Ports.
Digital infrastructure.
Industrial policy.
Agricultural productivity.
Urban planning.
Competition.
Skills.
Capital markets.
And the enormous informal economy.
It requires government to stop measuring success primarily by what it spends and start measuring success by what the economy enables Nigerians to produce.
That is the bridge between reform and prosperity.
Without it, Nigeria may become fiscally healthier without becoming materially richer.
It may attract investors without creating enough mass employment.
It may grow at 4 percent without creating a 4-percent improvement in the lives of ordinary people.
It may celebrate macroeconomic stability while households remain trapped in microeconomic insecurity.
And that would be the cruellest irony of all:
Nigeria could finally fix its economic numbers and still fail to fix its economy.
The country’s problem is not that Nigerians lack the capacity to create wealth.
It is that too much Nigerian effort is trapped in activities that create too little value.
The Nigerian worker is already working.
The Nigerian entrepreneur is already hustling.
The Nigerian farmer is already farming.
The Nigerian trader is already trading.
The Nigerian graduate is already searching.
The Nigerian manufacturer is already improvising.
The question is what happens when we finally build an economy in which all that effort produces significantly more.
That is when growth becomes income.
Income becomes purchasing power.
Purchasing power becomes demand.
Demand becomes investment.
Investment becomes jobs.
Jobs become productivity.
And productivity becomes prosperity.
Nigeria does not need Nigerians to work harder.
It needs Nigeria to make Nigerian work worth more.
That is the reform nobody is talking about.
And it may be the reform that matters most.
About the Columnist
Dr. Jude Dike is a Nigerian-Canadian economist, public policy analyst, and best-selling author.
As the columnist behind What Nobody Is Saying he brings a distinctive blend of academic expertise, government experience, international development insight, and public-policy analysis to the national conversation.
With a PhD in Economics and a master’s degree in Oil and Gas Economics from the United Kingdom, the columnist has built a versatile career spanning academia, government, international development, and policy advisory. His professional experience includes serving as a college professor, World Bank consultant, senior legislative aide, senior government adviser, political strategist and public policy analyst.
Drawing on this broad experience, What Nobody Is Saying offers incisive, independent commentary on Nigeria’s economy, politics, governance, public policy, energy sector, and the forces shaping the country’s future. Styled in the tradition of serious, analytical newspaper commentary, the syndicated column seeks to examine the issues beneath the headlines, challenge conventional thinking, and give voice to perspectives that often go unspoken.
As a Nigerian-Canadian with extensive international exposure and deep knowledge of Nigeria’s political economy, Dr. Dike brings a uniquely cross-cultural perspective to the country’s most consequential debates—asking not merely what is happening, but what nobody is saying about why it is happening and where it may lead.
