Nigeria’s financial system has undergone a profound transformation over the previous decade, with foreign money depreciation, rising inflation, gasoline subsidy elimination and excessive rates of interest eroding family purchasing energy whilst nominal wages, authorities income and monetary market valuations elevated.
A report by Comercio Partners, titled The Decade That Changed Money, examines Nigeria’s economic efficiency between 2016 and 2026, highlighting how successive oil shocks, the COVID-19 pandemic, world conflicts and home coverage adjustments reshaped the financial system, funding selections and the associated fee of residing.
The report discovered that the naira lost almost 90% of its greenback worth between 2015 and 2024, whereas headline inflation peaked at 34.8% in December 2024.
Nigeria additionally spent greater than N21 trillion on gasoline subsidies between 2005 and 2023, based on the Nigeria Extractive Industries Transparency Initiative.
Although macroeconomic circumstances have turn into extra secure because the turbulence of 2023 and 2024, the report cautioned that stabilisation doesn’t mechanically translate into improved residing requirements.
Oil shocks, foreign money reforms and inflation
Nigeria’s economic challenges unfolded in three broad phases. Between 2016 and 2019, falling oil costs and disruptions to crude manufacturing triggered a recession, international trade restrictions and rising inflation. The introduction of the Investors’ and Exporters’ international trade window in 2017 supported a tentative restoration, however structural weaknesses persevered.
The COVID-19 pandemic prompted one other recession in 2020, prompting a ₦2.3 trillion Economic Sustainability Plan and financial easing. While the financial system returned to development in 2021, the report argued that the restoration was shallow, with weak oil manufacturing and rising inflation undermining its advantages.
Between 2022 and 2026, world inflationary pressures, home provide constraints and long-delayed economic reforms converged. The elimination of petrol subsidies in May 2023 and the unification of international trade home windows triggered sharp value and foreign money changes.
The Central Bank of Nigeria subsequently raised its Monetary Policy Rate from 11.5% in 2022 to 27.5% in 2024 to comprise inflation and restore confidence. Inflation reached 34.8% in 2024, whereas the naira weakened to round ₦1,534 per greenback on the finish of that yr.
Conditions improved in 2025, when reported inflation fell to fifteen.15% by December following a rebasing of the Consumer Price Index. External reserves reached about $45 billion, whereas the naira strengthened. By May 2026, the report put the trade price at roughly ₦1,370 per greenback and the Nigerian Exchange All Share Index’s year-to-date achieve at 55.7%.
However, the report famous that inflation started rising once more in early 2026, demonstrating the financial system’s continued vulnerability to exterior shocks.
Wages rise as family purchasing energy falls
Despite successive minimal wage will increase, the associated fee of important items and companies has outpaced revenue development for a lot of Nigerians.
The nationwide minimal wage rose from N18,000 in 2015 to N70,000 in 2024. However, the report estimated that cumulative inflation between 2020 and 2025 reached 152.7%, exceeding nominal minimal wage development over the decade.
The stress has been notably extreme in meals, housing, transportation, training and healthcare. Food inflation reached 40.87% year-on-year in June 2024, whereas petrol costs climbed from roughly N87 per litre in 2015 to N1,239 in April 2025.
In Lagos, rents elevated sharply, with some neighbourhoods recording will increase of as much as 200% over the 24 months resulting in early 2026. The report estimated that lease might soak up about 70% of family revenue, considerably above the generally cited 30% affordability benchmark.
The report additionally highlighted the rising burden of cell information, faculty charges and medical bills, with foreign money depreciation growing the associated fee of imported inputs and companies.
These pressures have pressured households to chop spending, defer medical remedy, transfer to cheaper neighbourhoods and alter consumption. The report famous that decrease inflation doesn’t imply costs have fallen, however reasonably that they’re growing extra slowly.
Investors shift from yield to wealth preservation
Nigeria’s monetary markets additionally skilled a elementary shift as buyers responded to foreign money weak spot and chronic inflation.
Treasury payments and different fastened revenue devices steadily delivered unfavorable actual returns between 2020 and 2025. In 2024, for instance, the common one-year Treasury invoice yield was 16%, in opposition to inflation of 33.2%, leading to a unfavorable actual return of roughly 17.2%.
Equities carried out higher in a number of years, with the NGX All Share Index returning 51.2% in 2025 in opposition to inflation of 23.33%. However, the report warned that optimistic nominal returns don’t essentially translate into elevated purchasing energy.
Companies with pricing energy, dollar-linked earnings, robust dividend capability and exhausting property have been higher positioned to face up to inflation. Telecommunications, shopper items, banking and oil and fuel companies featured among the many sectors with traits that helped shield worth.
Property homeowners additionally benefited from rising alternative prices and rental revenue, whereas potential patrons, builders and tenants confronted greater acquisition, building and financing prices.
The report described this as a widening divide between asset homeowners, who have been higher positioned to protect wealth, and households depending on wages or low-yield financial savings.
Fiscal pressures and insecurity stay main dangers
Despite enhancements in tax assortment, Nigeria’s fiscal place stays constrained by debt servicing and a slim income base.
The report cited an estimated debt-service-to-revenue ratio of 53.2% in 2025, which means a substantial share of authorities income was absorbed by debt obligations reasonably than infrastructure and public companies.
It additionally recognized insecurity as a main economic danger, notably as a result of violence disrupts agricultural manufacturing, will increase logistics prices and discourages funding. Oil theft and pipeline vandalism additional weaken authorities income.
The method of the 2027 normal elections presents one other danger, as political stress might weaken the consistency of reforms which have imposed substantial prices on households and companies.
Productivity will decide the following decade
Comercio Partners argued that Nigeria’s subsequent part of development will rely upon translating macroeconomic stability into greater productiveness, stronger exports and higher public companies.
The report referred to as for more practical public spending on energy, transport infrastructure, training, healthcare, safety and digital infrastructure. It additionally highlighted the necessity to develop non-oil exports and direct reasonably priced, long-term financing in direction of agriculture, manufacturing, logistics and small companies.
For households, it really helpful constructing emergency financial savings, budgeting round precise residing prices, setting separate financial savings objectives and evaluating investments based mostly on inflation-adjusted returns reasonably than nominal features alone.
The report stated digital monetary companies, regulated funding merchandise and cooperative financial savings buildings might assist Nigerians handle economic uncertainty, however sustained progress would rely upon monetary self-discipline and constant planning.
