Nigeria's recent economic reforms have stabilized the macroeconomy, but the gains risk being squandered if policymakers don't shift focus soon. The Centre for the Promotion of Private Enterprise (CPPE) sounded this warning in response to the IMF's 2026 Article IV Consultation Report on the country.
CPPE welcomed the International Monetary Fund's positive assessment of Nigeria's reform efforts. But it said the government must now balance stabilization with growth, jobs, and improved living standards for ordinary Nigerians.
The IMF commended Nigeria for restoring macroeconomic stability and strengthening investor confidence. Exchange rates have stabilized, foreign reserves have grown, and capital inflows have improved considerably.
CPPE said these achievements align with positions the private sector has long advocated. "After years of macroeconomic distortions, the economy is gradually moving from a regime of instability to one of greater predictability," the group noted.
Yet the picture isn't complete. Poverty and food insecurity remain stubborn problems, CPPE pointed out, echoing concerns raised by the IMF itself.
Real reform must be measured by how citizens' lives improve, not just by statistics, CPPE argued. "Exchange rate stability, reserve accumulation and fiscal consolidation are important, but the true test of reform is whether they translate into lower food prices, better jobs, improved incomes and enhanced living standards," it said.
Here's where CPPE sees trouble: interest rates remain dangerously high. The central bank's monetary tightening has helped control inflation and steady the exchange rate, but the costs are mounting.
Borrowing has become prohibitively expensive for businesses across Nigeria. "The cost of credit in Nigeria has reached levels that are becoming increasingly prohibitive for productive investment," CPPE warned.
Lending rates rank among the world's highest. Companies struggle to finance expansion, launch new ventures, or hire workers under such conditions.
Banks aren't lending to businesses either. Instead, they're parking money in government securities where yields are attractive and risk is minimal.
"Capital is gravitating towards financial assets rather than productive assets," CPPE observed. Treasury bills and bonds are drawing funds that ought to fuel enterprise and innovation.
This pattern is unsustainable, CPPE insists. A nation cannot build lasting prosperity when government securities offer better returns than investing in factories, farms, or technology.
CPPE called for a policy reset. Economic management must now prioritize converting macroeconomic gains into shared prosperity across society.
The group isn't arguing against monetary discipline altogether. But it's clear: continuing to rely solely on high rates will choke off the very growth Nigeria desperately needs.
