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Two decisions Buhari needs to make to rescue his legacy on the Nigerian economy



Nigeria’s inflation rate in 2015 was a single digit of 9.01%. Inflation today is 17.71%. As of 2015, Nigeria’s debt revenue stood at N8.8 trillion. Today, debt sits at N41 trillion. In 2015, petrol stood at N87 per litre. Today a litre costs N165. In 2015 when President Buhari assumed office, the dollar was exchanging at N198/$, today the exchange rate is flirting with the N600/$ zone. President Buhari assumed office and GDP stood at $486 billion, now GDP as of 2021 is $440 billion.

Make no mistake, the economy is beyond saving before May 2023 and even after 2023, as the spillovers of poor economic policies, recessions, oil price crashes, and a global pandemic would test the mettle of the new government. But the President can prepare a soft landing for the new government in two ways.

Everyone who understands the Nigerian economy understands its dependence on oil. Oil supplies 90% of the country’s foreign exchange and over 50% of the country’s revenue. However, in the last decade, Nigeria has failed to optimally enjoy its oil dividends as a result of two things that President Buhari can address.

  1. Fuel subsidies.
  2. Oil theft and vandalism in oil-rich regions.

The Oil Sector in Nigeria since its inception has been bedevilled with a myriad of problems. The problems are not limited to non-functional refineries, subsidy payment, lack of Infrastructure, and oil theft, amongst others. During the electioneering season in 2015, President Buhari made a series of promises to the oil sector which includes passage of the Petroleum Industry Bill (PIB) within one year if elected, getting refineries working, end fuel importation, among other promises. To fulfil his promises, Buhari appointed himself as Minister of Petroleum. However, it will be noted that the PIB bill was passed six years after, in 2021, but other promises remain unfulfilled.

According to reports, Nigeria is the only member of the Organization of Petroleum Exporting Countries (OPEC) importing refined petroleum. The higher crude oil price goes in the global market, the more we’re paying for PMS, and by maintaining this PMS subsidy the country, unfortunately, forgoes investments that will have used the monies into essential infrastructure, goods, or services that would have increased the overall productivity of the nation. So, this is Nigeria’s imbroglio.

Nigeria, over the last few months, has frequently failed to meet up with its OPEC quota. The West African country boasts of a 2.5 million barrel per day capacity but has not produced that number in over a decade. At the 29th OPEC and Non-OPEC Ministerial meeting, OPEC increased Nigeria’s production to 1.799 million barrels per day. With OPEC’s projection, Nigeria is supposed to be the largest oil producer in Africa. According to reports from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), crude oil production in Nigeria has dropped to 1.02 million bpd. This figure represents the lowest production it has gotten in two years.

Some of the reasons attributed to this poor performance point to supply disruptions, waning investments, and oil theft. Now, Nigeria has lost its place to Angola as Africa’s largest producer of oil and not for the first time in the last ten years. Another implication is Nigeria’s budget for 2022. The projected figure for oil production in the budget is 1.6 million bpd, which Nigeria has failed to meet, and currently falls short by almost 600,000 bpd.

With Buhari’s tenure coming to an end in less than 10 months, and his ineligibility to contest having served two terms, how can he save his legacy?

Removal of fuel subsidy

President Buhari was amongst prominent Nigerians who participated in the “Occupy Nigeria” protest in 2012, when the then President, Goodluck Jonathan, announced the Fuel Subsidy’s removal, which increased fuel prices from N65 per litre to N141 per litre. It’s high time Buhari realized one of his lasting legacies would be the removal of the fuel subsidy.

In 2021, Nigeria increased its Value Added Tax (VAT) from 5% to 7.5%. Nigeria earned N2.07 trillion in VAT and N1.896 trillion in Company Income Tax (CIT) in 2021. Despite earning N3.966 trillion accumulated, the figure is less than the N4 trillion budgeted for fuel subsidy in 2022. In a turn of events, the International Monetary Fund (IMF) warned that Nigeria’s fuel subsidy might hit a record high of N6 trillion in 2022 going at the current rate. Zainab Ahmed, the Minister of Finance, Budget, and National planning, has lamented that Nigeria is struggling to meet debt service obligations.

President Buhari should know that removing fuel subsidies is important for a prosperous Nigeria. As fuel prices continue to soar in the global market, so is Nigeria’s subsidy. The current price of oil is a mixed one for Nigeria. Despite earning from the exportation of crude oil, the country spends more on the importation of Petrol. The payment of subsidies has affected the development of human capital in Nigeria, it has also hindered Nigeria’s infrastructural growth, and borrowing has reached astronomical figures, among others. Removing fuel subsidies is one of the ways Buhari can save his legacy.

As the Minister of Finance, Zainab Ahmed echoed, “How many Nigerians own cars that are benefiting from this subsidy?”. In 2022, Nigeria cannot accurately confirm how much fuel it consumes as a country, thereby creating gaps for smuggling and round-tripping.

No doubt, subsidies have alleviated the cost of living for Nigerians but at a price – An increase in debt, no investment in the oil and gas sector, and no revenue for the country. Now that the cost of living is still high, Buhari should pull the life plug and end subsidies once and for all, and claim responsibility and the imminent hardship it will bring. Sacrificing himself for the future of Nigeria and saving the new government from the political and social contract of subsidies.

Stoppage of oil theft

In 2021, Nigeria produced 440.774 million barrels of Crude Oil and earned N12.4 trillion. However, the country lost 73 million barrels at N3.038 trillion, this means Nigeria lost 25% of its earnings to Oil theft. In Q1 of 2022, the country exported N5.66 trillion worth of crude oil but lost N434 billion to theft. Oil theft over the years has been inimical to the growth of the oil industry in Nigeria.

Earlier in the year, Tony Elumelu, Chairman of United Bank of Africa, posted on Twitter that Nigeria loses 95% of its oil production at Bonny Terminal to oil theft. His claim was corroborated by the Group Managing Director of NNPC when he stated that Nigeria only gets 3000 barrels out of 239,000 barrels injected into the pipeline from Bonny Terminal. He also noted that Nigeria lost $4 billion in 2021, and has lost $1.5 billion in 2022 to oil theft. He concluded that oil theft has forced oil production to shut down at the terminal, which also affects Nigeria’s projected production.

The mode of operation involving oil theft is through Illegal modular refineries, which refine the stolen crude oil, and then transported it in cans, and kegs to different parts of the country. In January 2022, Rivers State governor, Nyesom Wike, ordered a crackdown on illegal refineries in the state. Navy operatives who are meant to protect pipelines, waters and have also been accused of aiding oil theft.

With Nigeria’s economy hinged on oil, President Buhari can save his legacy by ensuring oil theft is a thing of the past. As a former military man, he should deploy his wealth of experience in uncovering the heist going on in the oil regions. Losing 200,000 barrels per day comes at a great economic cost to a country that pays a huge sum for fuel subsidies. President Buhari should ensure that pipelines are given adequate security, technology should also be heavily deployed to provide surveillance of pipelines. Also, the Navy should be adequately equipped to protect pipelines and host communities should not be neglected as they also are important in the oil and gas industry.


With 8 months left until the 2023 general elections, Buhari can channel all his efforts in the oil industry in the following ways;

  • Put an end to subsidy after the Presidential elections so that the political risks of a protest/hardship do not prove counterproductive to his party’s campaign.
  • Provide support for the running of the Dangote refinery and prioritize it becoming operational so the country has at least one functioning refinery to reduce dependence on oil importation before his tenure ends.
  • Deploy security agencies to the regions where oil theft is organized, act on intelligence, provide aerial support through the Airforce, cooperate with stakeholders, and rejig the Navy team as they have been complicit over the years in putting an end to oil theft.
  • Set up a team to accurately find out how much fuel Nigerians consume to eliminate smuggling and inflated subsidy payments.
  • Ensure the Petroleum Industry Act is fully implemented with NNPC operating as a limited liability company as soon as possible.
  • Bonus point: Secure funding and financing for Nigeria’s planned 4000 km pipeline to take Nigerian gas – the largest reserves in Africa — via Morocco, then onto Europe.

The consequences of all this would come at a price in the short term but will safeguard the country’s economic future as the country would increase its oil output and reduce its fiscal burden.

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 Analysing the demands of Nigerian SMEs to achieve global competitiveness 




Growing globalisation presents Small and Medium Enterprises (SMEs) across the globe with an unprecedented opportunity to extend market reach, enhance performance, and potentially upscale to larger companies. Thanks to global interconnectedness, a small family-run business in a remote part of China can manufacture shirts and export worldwide. This is the case for most Chinese SMEs. In 2020 they accounted for 68% of Chinese exports, according to estimates by the Organisation for Economic Co-operation and Development (OECD). In Nigeria, the reality is different for most small and medium-sized businesses. 

In its latest report, the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) reported that only 7.7% of business enterprises surveyed exported their goods or services. Of this crop of businesses, 95.3% of exports value less than 10 million Naira ($23,300). This export data highlights the gross under-representation of Nigerian SMEs in international trade despite contributing to nearly half of the domestic GDP when combined with micro-scale businesses. 

The exclusion of Nigerian SMEs from global trade matters because the success of small and medium-scale businesses will directly translate to the enhanced global competitiveness of the Nigerian economy. China and India, both highly populated developing countries, have risen to prominence on the back of value-creation by entrepreneurs in SMEs. 

Furthermore, there is only so much value that can be created within a geographical market; however, expansion to other regions can create new demand and opportunities. Take, for instance, the $93 billion global oil palm industry where Nigeria has a market share of less than 5% despite having abundant natural and human resources to potentially produce and supply oil palm as well as derivatives. We lose out on the multi-fold values that could have been derived from processing and exporting to the vast global market if our agricultural commodities are only consumed within the country and our SMEs fail to break into the global markets. 

There is a plethora of reasons why less than a handful of SMEs in Nigeria are engaged in exports; most of the bottlenecks are behind the borders and overlap with challenges already identified by small and medium business operators. In the 2021 SMEDAN report, 92.4% of surveyed businesses believed the biggest challenge to enterprise development was the lack of finance.  

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The availability of funding is critical for the day-to-day operation of businesses as well as financing business expansion in the long term. Due to high-interest rates, high rates of informality, poor documentation culture, lack of sufficient cash flow, and weak macroeconomic conditions, many SMEs are unable to obtain loans from most financial institutions. Where obtaining a loan is possible, for example from a micro-finance bank, the volume is too little to make a meaningful impact while the volume of loans disbursed by government programs is good but could be better. As a result, 48% of SMEs depend on family and friends, while 15% rely on credit facilities, 8% on trade credit, 6% on co-operatives, and 6% on grants based on PwC MSME Survey 2020.  

Yet, engaging in exports is a capital-intensive venture because of the need to produce goods that meet international standards, as well as investments that need to be put into securing authorization (from Nigeria Export Promotion Council, Standards Organisation of Nigeria, NAFDAC, CBN, etc.) for exports and facilitating the logistics.  

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Another area in SMEs that needs intervention to improve their development, and in turn, global participation is the provision of infrastructure. Per the SMEDAN report, 20.9% consider the paucity of the quality physical infrastructure to be a critical challenge. The problem of infrastructure extends across the entire chain of value businesses rely on. Epileptic power supply means shorter production hours, high operating costs when generating sets (industrial or residential) are employed, or even high capital expenditure to procure alternative power sources. After scaling the issues of power supply, SMEs face obstacles imposed by poor transportation networks. For SMEs involved in exports, goods can be stuck for months at the port and end up in poor form by the time they arrive at their destination. 

Another area of demand for SMEs and similar businesses is vocational and entrepreneurship training. From the SMEDAN report, 20.8% of surveyed businesses rated gaps in vocational and business skills as the main constraint on enterprise development. Often overlooked, entrepreneurship and management skills are a bedrock of SMEs’ success. Programs on vocation and entrepreneurship will help business owners and operators learn essential business skills such as financial and risk management, strategy, sourcing business capital, taxation, human resource management, and so on. This training will also help businesses formalise and position themselves for better opportunities in the market.  

Other pressing demands of SMEs are the need for workspaces, consistent government policies, and access to research & development. Concerning government policies, some of the pain points of businesses are the multiplicity of taxes, demolition of properties, high fuel prices, customs duties, a ban on particular raw materials importation, and trade permits.  

The government would need to improve accessibility to capital to improve the situation for SMEs. Several state and private funding initiatives such as FGN Special Intervention Fund for MSMEs, National Enterprise Development Programme, the YouWIN Connect Nigeria program, The Youth Entrepreneurship Support (YES) Programme, Tony Elumelu Entrepreneurship Programme (TEEP), and Lagos State Entrepreneurs Trust Fund (LSETF) already exist amongst others. Improving access would involve creating more specialised funds for women entrepreneurs, and training SMEs on how to keep records and apply for existing credit and grants.  

There are no shortcuts to solving the problem of infrastructure for SMEs, but one quick win is expanding opportunities for export-oriented SMEs to participate more in Free Trade Zones (FTZs). FTZ, as defined by Mondaq, is any location where goods can be shipped, handled, manufactured, reconfigured, and re-exported without the involvement of customs agencies. These zones have a tendency to have better infrastructure and streamlined processes that allow a smoother flow of goods.  

On vocational and entrepreneurial training, a partnership by local and foreign experts in the private sector with the government in organising workshops, seminars, boot camps, and similar programs for SME owners and operators will go a long way. Through tax incentives consulting firms like the Big 4s can be encouraged to organise training for SMEs in areas like digitalisation, taxation, financial records keeping, and business strategy. This idea can be extended to the areas of research and development. Asides from private and public research institutes, academia can be a viable partner to pair SMEs with so that new products and technology can be developed. 

To conclude, it is paramount to drive home the point that SMEs hold so much potential to enhance growth and development for Nigeria, as is the case for many developing countries. The limitation faced by SMEs in global market participation is therefore an important issue for national development that must be addressed by all stakeholders.  

About the author:

 Connect with Nnamdi Okoh on Instagram @nnamdiokoh, Twitter @Lord_nnamz and LinkedIn @Nnamdi Okoh. Learn more about Terminal Africa’s service offerings at

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Lagos seals 42 health facilities across the state




The Lagos State Government, through the Health Facilities Monitoring and Accreditation Agency (HEFAMAA) has sealed a total of 42 health facilities out of about 1040 visited between January and September 2022. 

This was made known by the executive secretary of HEFAMAA, Dr. Abiola Idowu, in Ikeja while reviewing the activities of the agency in the nine-month period. 

Sealed for non-compliance with regulatory standards: Idowu said the facilities were sealed for non-compliance with regulatory standards, adding that other infractions committed include non-registration of facilities and lack of qualified medical personnel, as well as the illegal training of auxiliary nurses.  

She disclosed that in the same period, 170 facilities across the state were inspected for registration, while about 157 closure notices were issued. 

Idowu explained that the key areas monitoring officers focus on during monitoring and inspection exercises of health facilities are: the qualification of personnel, operation processes of the facility, the environment, and the standard of equipment. 

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On HEFAMAA’s monitoring activities, the executive secretary explained that the aim of the franchise is to improve the effectiveness of the monitoring exercise so that all the health facilities in the state can be monitored at least twice a year as the law stipulates. 

  • She said, “The Agency is empowered by the Health Sector Reform (HSR) Law 2006 to franchise some of its activities. Section 49 (5) of the law granted the agency the power to select franchise companies to monitor and ensure compliance with the law by health facilities in the state.’’ 

Get acquainted with the law: Dr. Idowu, therefore, advised owners and operators of health facilities to get acquainted with the law and carry out their operations in accordance with it to safeguard the health of the people. 

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She also emphasized the commitment of the state government to sustain the fight against quackery and unprofessional conduct in the system, as well as urged intending operators to ensure proper registration with the agency through its website, before commencing operations. 

Going further, she added that existing registered operators should ensure prompt renewal of their certificates to avoid being sanctioned. 


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Nigeria produces 13% of global tantalum output – EITI




The Extractive Industries Transparency Initiative (EITI) said Nigeria produces 13% of the global production of tantalum. 

EITI disclosed this in its 2022 Mission Critical Report which was released on Wednesday, November 2.   

Tantalum is a highly resistant mineral used in manufacturing electronics, especially mobile phones, laptops, and super alloys. 

According to EITI, the mineral will potentially be used in electric vehicle (EV) batteries, depending on the technology development and deployment of alternative zero-cobalt batteries.    

In 2021, China recorded imports of tantalum from Nigeria, the Democratic Republic of Congo (DRC), Ethiopia, Madagascar, Mozambique, and Sierra Leone.   

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Nigeria lacks mining data: The report showed that aside from the recorded tantalum production rate, Nigeria rarely had any definite data for 14 of the minerals highlighted in the report. That’s because the country’s solid mineral sector is characterised by artisanal mining and small-scale mining of manganese and tantalum. 

Lack of data discourages investors: The report showed that exploration and mapping of mineral deposits are limited in many EITI-implementing countries, especially African countries like Nigeria. The availability of comprehensive and public geological data determines the ability of resource-rich countries to attract responsible investors and negotiate favourable terms for the country and its people.  

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The importance of open geological data: EITI said access to open geological data is important to support a transition mineral development strategy and to level the playing field in negotiations between governments, companies, and communities. Transparent information can improve the terms of contracts, facilitate mine planning, and ensure that all stakeholders are well informed.  

Profit shifting in Nigerian mining market: In October 2021, the International Monetary Fund (IMF) said countries like Nigeria lose $600 million in revenue due to tax rate differences between African countries and offshore affiliates in the same multi-national enterprises’ group.   

The EITI report corroborates what the IMF said. The report said: 

  • “Research on profit shifting in mining across Sub-Saharan Africa indicates that African countries are losing, on average, between $470 million and $730 million per year in corporate income tax from MNE tax avoidance. The baseline estimate – which also includes Sub-Saharan African economies with small mining sectors – suggests a revenue loss of about $600 million, based on tax rate differentials between African countries and offshore affiliates in the same MNE group.”   

What you should know: Tax base erosion and profit shifting (BEPS) is a serious governance challenge for countries pursuing resource revenues from the taxation of multinational enterprises (MNEs).  

  • BEPS occurs when companies shift reporting of profits generated in higher tax jurisdictions to other parts of their business in lower tax or no-tax jurisdictions.  
  • This challenge could become more pronounced in the transition minerals sector given the integrated business structures of many of the MNEs involved in mining, processing, refining, marketing, and trading in transition minerals across multiple jurisdictions.  
  • There are also increasingly powerful global partnerships controlling transition mineral value chains, for example, through the consolidation of mine-to-car business deals by upstream and downstream MNEs.    

Nigeria must take action: Nigeria and other sub-Saharan African countries need to take intentional steps to maximize their mineral resources, especially in the era of the global energy transition.  

  • During the October 2022 Reuters Impact Climate Conference in London, the president of the Africa Finance Corporation (AFC), Samaila Zubairu said it was time for Africa to rethink the approach to its mining value chain.  
  • According to him, mining is carried out in Africa, and the minerals are exported to Asia where they are processed and exported to other parts of the world. He said that this cannot continue and Africa needs to also process mineral resources so, there is value capture here before exports take place, and Africa can expand its mining capacity.   
  • Zubairu said; “Africa needs to expand its mining capacity, more minerals should be sourced, mined, and processed here on the continent. More investments in adaptation will increase infrastructural capacity.” 


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