About 63 per cent of Nigerians have fallen below the poverty line following the removal of the fuel subsidy, a new study has revealed, highlighting the widening economic hardship facing households across the country.
The research, presented at a stakeholders’ dialogue organised by Agora Policy in Abuja on Thursday, showed that the poverty rate surged from a baseline of 49.8 per cent to 63 per cent after the subsidy was scrapped, before moderating slightly to 56.2 per cent following the introduction of social protection measures such as cash transfers.
Titled “Sustaining and Deepening Economic Reforms in Nigeria,” the dialogue convened policymakers, economists, civil society leaders, and private sector representatives to assess the impact of the Federal Government’s reform agenda.
Among the attendees were Dr Muhammad Abdullahi, Deputy Governor for Economic Policy at the Central Bank of Nigeria (CBN); Ms Sanyade Okoli, Special Adviser to the President on Finance and Economy; Dr Samer Matta, Senior Economist at the World Bank; and Dr Hussaini Abdu, Country Director of CARE International.
The study, conducted by Dr Mohammed Shuaibu, Senior Lecturer in the Department of Economics, University of Abuja, showed that low-income households were the hardest hit.
“While high-income households remained largely insulated, poor households saw their purchasing power collapse,” Shuaibu said.
The research also revealed that the national poverty gap widened from 31.6 per cent to more than 45 per cent, indicating deeper deprivation among vulnerable populations.
Household consumption fell sharply, especially in rural areas, as rising fuel and electricity costs forced families to cut spending, ration electricity, and rely on borrowing.
Although social protection programmes helped cushion the blow, delays and limited scale meant that the relief was insufficient. Businesses also faced mounting pressures, with rising operating costs forcing some to raise prices, reduce staff, or shut down operations.
Speaking at the dialogue, Dr Abdullahi said the reforms, though painful, were necessary to correct structural imbalances.
He noted that Nigeria’s oil revenue had collapsed from $92bn in 2012 to less than $2bn in 2023, creating severe fiscal pressure and making subsidy removal unavoidable.
“The subsidy regime and exchange rate distortions together cost the economy about six per cent of GDP,” Abdullahi said, adding that the CBN had cleared $4.5bn of backlogged foreign exchange obligations to restore confidence in the market.
Meanwhile, Dr Chinyere Almona, Director-General of the Lagos Chamber of Commerce and Industry, warned that while macroeconomic indicators improved, many Nigerians had yet to feel the benefits.
She called for complementary policies, including better access to credit and targeted support for small businesses, to ensure reforms translate into tangible improvements for citizens.
Experts, including World Bank’s Dr Matta, urged the government to expand social protection programmes and strengthen the National Social Register, ensuring vulnerable households receive timely assistance to mitigate the shocks of reform.
The study concluded that while economic reforms are crucial for long-term stability, their rapid implementation has triggered severe short-term hardship, leaving millions of Nigerians struggling to cope with soaring living costs.
'
'Do you want to share a story with us? Do you want to advertise with us? Do you need publicity for a product, service, or event? Contact us on WhatsApp +2348183319097 Email: platformtimes@gmail.com
We are committed to impactful investigative journalism for human interest and social justice. Your donation will help us tell more stories. Kindly donate any amount HERE
