Tinubu’s reforms have put Nigerian economy on path of sustainable growth

Billionaire tycoon and chairman of First HoldCo Plc, Femi Otedola, has lauded a series of reforms introduced by President Bola Tinubu to accelerate economic growth in the country.

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Mr Otedola gave the commendation in Paris on Monday at a private dinner with the president, who has been on a 28-day working vacation in Europe.

President Tinubu’s “bold and forward-thinking reforms have put our economy firmly on a path of sustainable growth,” he said.

“The results are increasingly evident, top Nigerian companies now included on the FTSE Russell Frontier 50 Index, the NGX at historic highs, increased foreign direct investment and renewed economic confidence, a unified and more stable foreign exchange market, foreign reserves standing strong at about $55 billion, and so much more,” Mr Otedola added.

Nigeria has pursued reforms aimed at economic recovery, speeding up growth and stabilising the economy, since President Tinubu took over power in May 2023.

The government scrapped petrol subsidies, which had sapped the treasury of trillions of naira annually and had been a drain on public finance, an unpopular but investor-friendly move seen by analysts as critical to attracting international investors.

Yet, it has had a profound impact on the cost of living, with energy, transportation and food costs now at unusually elevated levels.

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The government has also unified the foreign exchange market by collapsing multiple, segmented exchange rate windows into a single market-driven system, with FX rates now determined by the forces of demand and supply, rather than in the former regime where the exchange rate was pegged.

Similarly, the naira has been sharply devalued to boost foreign investment, even though the push has fuelled inflationary pressures.

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One of the latest wins is Nigeria’s reclassification to frontier market status by FTSE Russell after three years of being downgraded to an unclassified market.

Following the restoration, big-cap equities like Dangote Cement, First HoldCO, MTN Nigeria, GTCO, Nestle Nigeria, Nigerian Breweries, Stanbic IBTC Holdings, Aradel Holdings, Presco and Zenith were admitted to FTSE Russell’s Frontier Index Series, effective this month.

Quoting the companies in the Frontier Index Series provides them with broader visibility among international investors than their primary listing on the Nigerian Exchange in Lagos.

In the same vein, the country’s external reserves have crossed the $55 billion mark, the highest in more than 18 years.