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Africa’s Most Consequential President?

Bola Tinubu, Nigeria's new leader, has enacted a raft of bold economic reforms in his first weeks in office. If he addresses the country’s security challenges, energy woes, and governance shortcomings, and secures the backing of investors and development partners, he could transform the continent’s largest economy.

WASHINGTON, DC – Shortly after taking office on May 29, Nigeria’s President Bola Tinubu surprised many observers by implementing a series of bold reforms. In addition to scrapping costly fuel subsidies and various taxes, he suspended the country’s central-bank governor, which led to the immediate removal of trading restrictions that propped up the value of the naira. And to curry favor with Nigeria’s huge population of young people, Tinubu introduced interest-free loans to help students fund higher education.

But while these rapid reforms signal Tinubu’s adherence to economic orthodoxy and may restore the confidence of Nigerians, international investors, and financial markets in the short term, by themselves they will not affect lasting change.

Nigeria’s economy – Africa’s largest – is in dire straits, and transforming it will not be easy. Inflation recently hit an 18-year high, and large fiscal deficits are adding to already-soaring debt levels. The economy has been hit hard by the fallout from the war in Ukraine, partly because Nigeria depends on food imports, but also because the country – despite being Africa’s biggest oil producer – is largely incapable of refining crude and thus imports petroleum. Mismanagement, security issues, and underinvestment in infrastructure have hobbled the oil industry, which generates around 80% of government revenues, while inconsistent official policies have prevented the agriculture sector, which employs about a third of Nigerians, from reaching its full potential.