When Fati Usman, an Abuja-based small fashion designer, closed her shop in Gwarimpa in mid-2024, she had already made up her mind that she would not renew the rent. Her dream to buy more equipment and hire more extra hands to expand her fashion business would have to wait, perhaps indefinitely.
“Everything is going up. Cost of running the business is crazy,” she said with her thirty-three-year-old face wrinkled by frustration. She sold a few of her equipment, and continued her business at a smaller scale in her house in Dawaki.
Across Nigeria, stories like Usman’s have become alarmingly common. From petty market traders to mid-sized companies, individuals and businesses are bearing the brunt of a government desperate to shore up its finances. Since President Bola Tinubu assumed office in May 2023, his administration has unleashed a flurry of revenue-generating reforms — removing subsidies, floating the naira, introducing levies, and tightening enforcement.
While these moves were intended to rescue a tottering economy, they have triggered a wave of hardship not seen in years, squeezing households, shutting down businesses, and hollowing out the middle class.
Strangled at both ends
The first hammer blow landed on May 29, 2023, the day President Bola Tinubu announced the immediate removal of petrol subsidies during his inauguration speech. What had long been whispered in policy circles — that the subsidy regime was unsustainable — became a sudden, lived reality for millions. Overnight, the pump price of petrol more than tripled, moving from about N185 per litre to between N500 and N700 in most parts of the country, depending on supply chains and location.
With fuel costs acting as the lifeblood of the Nigerian economy, the effect was immediate and devastating. Transportation fares skyrocketed. Commercial drivers, inter-state bus operators, and logistics firms passed the burden directly onto commuters and businesses. From Lagos to Kano, Port Harcourt to Maiduguri, the cost of moving people and goods rose sharply. Within days, the prices of food staples — rice, garri, beans, tomatoes — began to climb as traders, faced with higher transportation costs, adjusted their margins to survive.
For ordinary Nigerians, the ground shifted almost literally under their feet. A daily bus ride to work that previously cost N300 quickly jumped to over N700. A farmer transporting produce to the city now faced doubled logistics costs. In rural areas, food markets began to thin out as supply chains grew erratic.
A student of the Federal University of Technology, Akure, Paul Kunle, decried the surge in the cost of transport.
He said, “I am spending a lot on transport as a student, and I think this country is just unfair. From FUTA to Oja has become N500, something that used to be N50 under Goodluck Jonathan and N200 under Muhammadu Buhari. A trip from my house to the school that used to cost me just N500 now costs me over N3000. How is that fair?”
As if this shock was not enough, the second blow came swiftly. Barely a month after the subsidy removal, the Central Bank of Nigeria, acting under Tinubu’s directive, scrapped the multiple exchange rate regime that had defined Nigeria’s foreign exchange market for years. The naira, which traded officially at around N460/$1, was floated and subjected to the market’s brutal discipline.
The currency collapse that followed was unprecedented in scale. By early 2024, the naira hovered around N1,600 to the dollar. For an economy heavily reliant on imports — from fuel and pharmaceuticals to electronics and food — the repercussions were catastrophic.
Imported medicines tripled in price. Building materials like cement and steel rods became almost unaffordable for small contractors. Even imported school textbooks became luxury items for middle-class families who previously took such expenses for granted.
Inflation quickly went from worrying to historic. According to the National Bureau of Statistics, headline inflation soared to 34.8 per cent year-on-year by December 2024 — Nigeria’s highest in nearly three decades, and one of the worst globally. Food inflation was even more alarming, topping 40 per cent.
The realities were stark. A loaf of bread that sold for N500 in early 2023 was now retailing for N1,300. A bag of rice, which cost N35,000 a year earlier, crossed the N80,000 threshold. A small basket of tomatoes that once sold for N3,000 now hovered near N10,000 in some markets.
For millions of families, basic budgeting became a nightmare. It was no longer about saving for the future; it was about surviving the week. The average worker, who earned N30,000 to N50,000 monthly, suddenly had to choose between paying school fees or eating well, between refilling cooking gas or walking long distances to work. There is a silent crisis sweeping across Nigerian households. Informal coping mechanisms have now become the norm. Nigerians are carpooling to work, skipping meals, and buying food in smaller, cheaper portions. The middle class, often seen as the buffer between the rich and the poor, has taken perhaps the worst hit. Private school fees are now out of reach for many. Health insurance has been abandoned by those who previously could afford it. Homeownership dreams have been shelved indefinitely.
Meanwhile, businesses, from roadside kiosks to formal SMEs, continue to battle soaring operational costs. Restaurant owners are recording a decline in demand. One of such restaurant owners runs a food business in an estate in Idu, where she daily prays that there will be an increase in patronage. A mother of three, Mrs Mary Tola, noted that the cost of running her business has increased tremendously, and she was compelled to increase the prices of the food she sells. However, getting regular customers has been a serious challenge for her.
The government, for its part, insists that the reforms are laying the foundation for a stronger, more resilient economy. Officials point to rising oil revenues, increased foreign exchange inflows, and growing tax receipts as evidence that painful sacrifices are yielding dividends. But on the streets, where inflation is more than just a statistic and devaluation is more than a currency story, faith in promised relief is wearing thin.
The International Monetary Fund recently said that while the Nigerian government has taken important steps to stabilise the country’s economy, the impact of these reforms is yet to be felt by most citizens, as poverty and food insecurity remain high.
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