Subsidy Removal, FX Convergence Yield Expected Results - Analyst, Gabriel Idahosa

Added: 2026-06-03

[00:00:00]opinion about on President Bola Ahmed Tinubu's uh economic scorecard in the last 3 years. On May 29, 2026, President Tinubu marked 3 years in office. In the last 3 years, President Tinubu's government has rolled out economic reforms which have resulted in mixed impact on Nigerians. Upon the kickoff of President Tinubu's administration, he had announced to the implementation of twin policies, namely fuel subsidy removal and naira liberalization. A cross-section of economists rated President Tinubu's economic performance over the past 3 years some between 60 70% saying the administration reforms have recorded some successes but are yet to significantly improve the welfare of ordinary Nigerians. He described or some of these experts described administration's record as a work in progress noting that key reforms have helped lay the foundation for economic uh long-term economic stability. Well, let's talk to Mr. Gabriel Idahosa who's the CEO of UHY Professional Services.

[00:01:03]Thank you so much. Uh it's good to have you on the show. Good afternoon.

[00:01:08]>> Thank you, Solo.

[00:01:09]>> Yes.

[00:01:09]>> Good afternoon.

[00:01:11]>> Clearly, I'm sure you heard my introduction. Uh many say that this uh administration's reforms is setting a pace for uh like everyone will say better future if I'm allowed to say that. But, I want you to first take us you know, through what you make 3 years uh down uh just like yesterday, 2023 and now it's 2026, another election in 2027.

[00:01:37]How far have we gone economically?

[00:01:43]>> I think as you uh said in your intro, there are mixed uh results.

[00:01:49]Mixed in terms of the direction of the impact of these very significant reforms.

[00:01:56]What is not in doubt or that this reforms were needed. They needed to be done at some point.

[00:02:04]And it was up to President to have the courage in spite of the foreseeable difficulties that they would create to have the courage to say we will have to take these decisions and face those consequences.

[00:02:23]So, in the last 25 years here was one president who said we're going to have to do it. We are postponing for too long.

[00:02:33]So, for that I think everyone gave that credit for just having the courage to do it.

[00:02:39]But now the consequences are where the debate is at.

[00:02:44]The removal of the fuel subsidy, the conversions of the foreign currency exchange rates have produced expected results.

[00:02:55]One of the clear result which everybody in and out of Nigeria agrees is good is the stability of the exchange rate around a very narrow band now in the last few years that most people can see after an initial spike.

[00:03:12]Now we now have that and we are almost taking it for granted now that I expect the rate to constantly stay between X and Y.

[00:03:19]Between 50 naira and 100 naira you can always say last 3 months in the next 6 months to come. That was something that was extremely difficult to achieve for a long time. So, we are in a good place in that market, the foreign exchange market.

[00:03:34]Supported of course by its central bank that imposed discipline in all participants in the foreign market, foreign exchange market.

[00:03:43]So, we will say that is a good outcome.

[00:03:47]In the fuel subsidy space that is where the are real issues in terms of the impact on inflation for example that has spiral because we just have to cope with a massive increase in price of petroleum products and we are still dealing with that.

[00:04:07]Part of the impact of that is a significant reduction in the the purchasing power of the income of the average Nigerian. So, the average Nigerian has got much lower in terms of what he can buy with he or she can buy with whatever income.

[00:04:26]So, we are dealing with that. And I think perhaps that is the most significant impact that is in the mind of most Nigerians that you know, our buying power is down.

[00:04:39]We can't afford so many things we were able to afford.

[00:04:42]But it was obvious this was going to happen.

[00:04:45]So, the concern now is how quickly has the government in the last two years addressed the need to provide some kind of solution.

[00:04:59]The buzz was palliative, mitigation, something to reduce the impact.

[00:05:07]There's a lot of thinking or school of thought that we have not done enough.

[00:05:14]That we have not moved as fast as we could to reduce the impact. But we can see some traction.

[00:05:24]You just talked about vehicles, electric vehicles, and CNG vehicles. We are seeing some traction.

[00:05:31]We just need to have a lot more of that.

[00:05:34]The pace at which the CNG buses in particular coming out for mass transit needs to be much faster than what we are seeing.

[00:05:43]The pace at which e-vehicles are into our needs to move faster, particularly the infrastructure to back it. If there are charging stations everywhere, a lot more Nigerians would be buying electric vehicles by now. But you don't want to buy a vehicle and you're scared of driving too far from your house because you cannot. So, some areas we are beginning to lend education space.

[00:06:09]Now, hundreds, thousands of course, hundreds of thousands in in in of students around our our country who are saying that they are able to go through their universities or polytechnics because of access to the education loan funds. So, there are pockets of significant success that is now visible because the the general demand is we want to see the benefit on our dinner table.

[00:06:34]>> And if you're a parent >> whose whose child is now being uh covered by uh the education loan funds, you surely can have your money money on your table. The money you would have spent to pay school fees, you can now have it to buy food on your table. So, those are the kinds of uh trickle-down benefits that Nigerians are want want to see multiply.

[00:06:58]Where the reforms are now converting into significant improvements in their day-to-day living. But it is it it is on track.

[00:07:08]I think the legitimate demand from Nigerians is that these successful initiatives should be expanded. It's a matter of scale. They should cover more of Nigerians and they should come out much faster.

[00:07:22]While we deal with those that are taking much longer. Some will take much longer.

[00:07:26]For example, you can't build the buses in large numbers overnight, even if you're importing them.

[00:07:33]But there are things that can be done that a lot more things that can be done that governments uh begin should and begin to look low hanging fruit that can be quickly implemented and begin to reduce the basic income level of poverty you know across a very large perhaps more than 50% of Nigerian population.

[00:07:56]And that that's that's that's where the the government really have this work cut out of how to quickly reduce poverty while this reforms are running through the natural cycle.

[00:08:06]>> Mhm. Great stuff as as as as always.

[00:08:10]>> Now, we uh first quarter 2026 GDP uh we saw it out about 3.89% if if I I am correct uh from 4.07 which we had in Q4 of 2026. There was a bit of moderation around that space. Many said it was expected. Uh but now in your own projection and with what you said earlier, when are we likely to start to see uh well, I know that nobody has the silver ball, but what do you think? What are those things that we should now start to put in place? Are we supposed to focus on agriculture? What are the sectors that can create more jobs? Because we saw the likes of ICT, uh financial services, they're not employing as much as we would expect. So, what do you think government can do to also open up all of those sectors that can create the kind of jobs that are needed. Once people are empowered, they get salaries, they would be able to feed.

[00:09:10]>> Okay, opportunities for mass job creation, you mentioned the agriculture is number one.

[00:09:18]Infrastructure, infrastructure, infrastructure across all these levels of government.

[00:09:25]We we don't we shouldn't always be talking of federal government.

[00:09:28]The local governments, the state governments, then the federal government needs to invest heavily in infrastructure, mass housing, the road networks outside the major highways into the local governments, into the communities.

[00:09:45]That level of investment in infrastructure, if it driven, can create a lot of jobs. The other areas of massive job creation are in tourism and the creative industry.

[00:09:58]These are industries that create jobs that you cannot export.

[00:10:02]Tourism industry, you cannot export jobs. People coming to Nigeria, they have to be in Nigerian hotels. They have to eat Nigerian food. They have to go to Nigerian theaters. You cannot export those jobs.

[00:10:13]Some IT jobs you can export, but you cannot export tourism and creatives. In fact, creative jobs are now earning foreign currency in Nigeria.

[00:10:22]And we are now creating some jobs in Nigeria in the tech space for foreign employers and foreign clients. So, the opportunities for create for mass creation of jobs are in those sectors that are well known.

[00:10:39]So, in the area particularly of agriculture, the real challenge is security.

[00:10:45]The security is the big issue as far as job creation in agriculture is concerned.

[00:10:50]If we were If we somehow we can fix security, you can almost predict a 10% 20 30% increase in agricultural jobs.

[00:11:00]But, a lot of people are scared to go to farms. And if they farm at all, it's very close to the house, something they can run back to the house or a short distance.

[00:11:09]Uh it's not like Nigeria where you where farmers would leave their house in the morning and stay in the farm the whole day and come in the evening because there was no worry about And to it, you could go 10 miles from your home and have a farm and come back peacefully late in the evening and you didn't have any worries. But, that all that has been wiped out. So, that is where uh you know, the work is. Creating an environment where farming is safe both for the small farmer and for the very large farmers. The large farmers can afford security for themselves, but the the the the uh smaller farmers cannot afford the security that they need uh to protect themselves.

[00:11:53]So, we have to look at the sectors and how we enable them to to create those jobs that we badly need.

[00:12:00]>> Finally, finally, we've seen inflation back. There's an optic. Well, many would say it's because of what is happening in the Middle East. Well, really, that's the reality on ground. It's not just in Nigeria. We've seen that inflation, but you know, some Nigerians will not just want to listen to these things. When we try to even talk about the figures, some don't even want to listen to the figures anymore. So, uh we also saw the MPC being very careful, of course, reacting to what had happened, uh reacting to the inflation figures. Uh now, as we move on uh if because we see that um of course, today there was again an optic with regards to uh crude oil prices because of what is still happening in the Middle East. If that continues and inflation continues to tick higher and uh Trump decides not to uh agree on a deal uh whichever way, what would happen with regards to MPC projections? I'm thinking that this might start to erode some of the positives of these reforms.

[00:13:00]>> Yeah, that that that like anything situation in life, there these are the the controllables and the uncontrollables. The things that you can control, the things which you just cannot control. And and you said it exactly as it is.

[00:13:15]It's up to him in the White House to decide when he wants to have peace.

[00:13:22]And the rest of the world is navigating around the timing of when he takes that decision.

[00:13:28]The rest of the world we have to navigate their own situations. Um At the beginning, various scenarios were were looked at by strategists.

[00:13:40]Is it a short thing, 1 or 2 weeks, and you have a deal? It is 2 months.

[00:13:47]Yes, impact, but not too bad. But if it gets to 3 months, 6 months, then it's going to be really catastrophic.

[00:13:54]Uh because we have seen the damage it has caused now in a short period. If this damage continues, then it's not just Nigeria, the whole global economy uh in terms of growth for this year is almost likely to nosedive.

[00:14:08]Uh because it is very difficult to re- to resolve disruptions. Most countries, the big countries, the Chinas of this world are finding ways to deal with the disruptions. But it's very difficult to move away from fuel fuel industrial complexes that are based on fuel on fossil fuels.

[00:14:30]It is not possible to use solar solutions for a massive plan that is running on on the fossil fuels. So, if this Ukrainian Ukraine and Iran together continues, because it they are building in one another.

[00:14:49]If both of them are unresolved in the next 6 months, then we expect that most of this year we we the the world economy, including Nigeria, we will not do so well.

[00:15:01]There is no uh quick fixes. It is in the long term, 1 year, 1 and 1/2 years, 3 years, that most countries will now be finding alternative solutions.

[00:15:10]Which have have started. Like the Gulf states trying to build pipes to take oil out of their their countries without going going without going through the Strait of Hormuz.

[00:15:21]Countries like China doing a lot more solar.

[00:15:24]All those solutions to avoid the destruction from the war in Ukraine will take time to to be resolved. So, uh there's nothing that the NBS or uh the Central Bank or anybody in Nigeria can do in a short time.

[00:15:45]You know, if if if nothing happens uh in in the next uh 12 months. In the long term, of course, every country, including Nigeria, will start finding alternative solutions and a way to live with the situation, like they have managed to find ways to deal with Ukraine and after COVID we have a new economy after COVID.

[00:16:07]So, it depends on how long uh it takes from to decide. If it If it decides it's a long war, to go for many years, then all countries should decide go back to the drawing board and you begin to design strategies uh in a new world of continuous uranium.

[00:16:23]Those are Those are the scenarios that are playing out.

[00:16:25]Mr. Gerbali, in terms of strategies at this time.

[00:16:28]>> Mr. Gerbali Dahoosa, CEO, UHY Professional Services, thank you so much again for your time on the program.

[00:16:34]Always interesting having you spend your time with us. We have