Hardship Deepens Despite Rising Investor Confidence

 

Nigeria’s cost-of-living crisis is deepening despite growing investor confidence in the economy, with millions of citizens struggling to cope with rising prices of food, transportation, housing and other essential commodities.

A fresh report by Reuters on Monday highlighted the widening gap between improving macroeconomic indicators and the difficult economic realities confronting ordinary Nigerians, ahead of the country’s 2027 general elections.

The report cited the experience of a health worker in Abuja who earns N135,000 monthly, nearly twice the national minimum wage, but said her salary is exhausted within days because of rising household expenses.

The cost of preparing a basic meal of jollof rice has more than doubled since President Bola Tinubu assumed office in 2023, according to a food-price index compiled by SBM Intelligence. Petrol prices have also risen sharply following the removal of fuel subsidy and the subsequent weakening of the naira.

The economic hardship has been linked to several major reforms introduced by the Tinubu administration, including the removal of petrol subsidies, currency reforms and changes to electricity subsidies. While the government has defended the measures as necessary to stabilise public finances and restore investor confidence, their immediate impact has placed considerable pressure on household incomes.

The World Bank estimated that slightly more than half of Nigeria’s population lived in poverty in 2025, compared with about 42 per cent in 2022, underscoring the social consequences of the economic adjustment.

At the same time, however, Nigeria has recorded stronger investor sentiment and improved financial-market performance. The Nigerian stock market has risen by almost 60 per cent this year, while foreign capital inflows reached a six-year high of about $23 billion in 2025, according to data cited by Reuters.

The positive investment figures have been welcomed by the government as evidence that its economic reforms are beginning to produce results. Officials have also pointed to improvements in public finances, increased investment in the oil sector and the growth of domestic refining capacity as signs of economic recovery.

But the benefits of the improved investment climate have yet to reach a large proportion of Nigerians, with fewer than five per cent of adults participating directly in the capital market. Much of the foreign investment has also gone into short-term financial instruments, rather than directly creating jobs or raising household incomes.

The growing disparity between financial-market performance and household welfare is emerging as a major challenge for the administration as the country approaches another election cycle. A June survey by SBM Intelligence reportedly found that 80 per cent of Nigerians believed the country was moving in the wrong direction, while insecurity and kidnapping remained among their major concerns.

The government is expected to face increasing pressure to ensure that the gains recorded at the macroeconomic level translate into lower living costs, stronger purchasing power, more employment opportunities and improved living standards.

With the 2027 elections approaching, the ability of the government to convince Nigerians that its reforms will eventually produce tangible improvements in their daily lives could become one of the defining economic and political issue of the coming months.