By Abdulrauf Aliyu
Tanimu Yakubu’s recent essay on Nigeria’s exchange rate reforms reads like a victory speech. He paints a picture of the naira’s recovery from ₦1,800 per dollar in March 2024 to ₦1,525 by August 2025 as the product of bold policy choices that are now powering a new export-led economy. It is an elegant story: reforms bring realism, realism makes goods cheaper, cheaper goods boost exports, exports bring dollars, dollars stabilise the naira, and stability attracts investors. On paper, it sounds almost like the “textbook” cycle he himself describes.
But history and lived experience caution us against such neat narratives. The problem with Yakubu’s analysis is not that it identifies real progress, but that it elevates fragile short-term outcomes into a story of structural transformation. Empirically, analytically, and methodologically, the argument falls short. A nation with Nigeria’s economic history must be wary of confusing a temporary breeze for a change in climate.
The first issue is causality. Yakubu attributes the naira’s strengthening almost entirely to policy reforms—particularly the unification of the foreign exchange windows. But exchange rates are shaped by a tangle of forces: oil earnings, remittance inflows, speculative positioning, even the tactical interventions of the Central Bank. To assign all the credit to a single reform is to mistake correlation for causation. In Nigeria, we have seen such misreadings before. The naira strengthened briefly after certain policies in the 1990s and early 2000s, but those moments did not last once the external environment shifted. To put it simply, one swallow does not make a summer.
The second problem lies in scale and context. Yakubu rightly points to the growth of non-oil exports from $2.7 billion in H1 2024 to $3.2 billion in H1 2025, but even at this improved level, the figure is small when placed beside the size of Nigeria’s import bill, the weight of external obligations, or the continued dominance of oil in overall earnings. It is also important to adjust for inflation, both at home and abroad. In dollar terms, an increase may look impressive, but once one considers price effects, the gain in competitiveness may be less striking. Nigeria’s economic history is full of similar “surges.” Groundnut pyramids in Kano once dazzled, just as cocoa exports enriched the West in the 1950s, but without deep investment in value addition and infrastructure, those booms evaporated like morning dew under the sun. Export growth that is not embedded in structural transformation is fragile.
Third, Yakubu presents a linear feedback loop: FX reform brings realism, realism lowers export prices, exports expand, inflows return, naira stabilises, investors gain confidence, and the cycle sustains itself. The logic is neat, but Nigeria’s political economy is rarely linear. Rent-seeking, institutional weaknesses, infrastructural deficits, and policy inconsistency act as leakages that break these chains. Consider the Structural Adjustment Programme of the 1980s. It, too, was built on the promise that devaluation and market realism would spark an export boom and reset the economy. Instead, Nigeria was caught in debt traps, inflation, and social unrest. The “loop” on paper broke down under the pressure of political realities. History is clear: economic systems do not behave like equations in a textbook; they behave like societies, with all their frictions, contradictions, and imperfections.
Fourth, there is the absence of counterfactuals. Yakubu celebrates the outcome but does not ask: what would have happened without the reforms? Nor does he compare Nigeria’s trajectory with peer economies that pursued similar adjustments. Without a comparative lens, the argument risks becoming self-congratulation rather than analysis. Beyond that, his focus on aggregate figures ignores the distributional question: who benefits, and who bears the costs? Exporters and investors may cheer, but ordinary wage earners, petty traders, and households carried the pain of the currency’s initial plunge. Inflation eroded their purchasing power long before the naira stabilised. Reforms without broad legitimacy tend to collapse. Nigerians remember the protests of the 1980s and the subsidy unrest of 2012: technocratic language promised growth, but the people felt only hunger and hardship.
Finally, there is the rhetorical flourish that Nigeria has turned its currency into a “competitive weapon.” This is appealing language but hollow economics. A currency does not create competitiveness by itself; it only reflects the state of production, governance, and trust. For Nigeria to wield the naira as a true instrument of power, it must first fix the fundamentals: diversify exports, strengthen institutions, invest in infrastructure, and build fiscal credibility. Otherwise, the naira’s recent strengthening is a ripple, not a tide.
Yakubu’s narrative is too neat for Nigeria’s messy reality. He mistakes the first glimmer of light for dawn, but Nigeria has seen many false dawns. The oil windfalls of the 1970s, the SAP optimism of the 1980s, the banking reforms of the mid-2000s—all promised transformation, but each fell short because the deeper foundations of the economy were not rebuilt. Until Nigeria learns to distinguish temporary reprieves from genuine renewal, it risks celebrating shadows while the real work remains undone.
