Argentina, which experienced multiple debt defaults (notably in 2001 and 2014), leading to devastating economic consequences.
Greece, which went through a severe debt crisis in the late 2000s and early 2010s, resulted in extreme austerity measures.
Venezuela, whose economy collapsed under hyperinflation and debt defaults.
Zambia, which defaulted on its Eurobond debt in 2020.
Pakistan has repeatedly required bailouts from international financial institutions due to recurring debt crises.To provide context, I urge Nigerians who are currently agonizing under economic hardship to imagine how much worse life could have been if President Tinubu had not intervened with his bold reform agenda. Compared to the fate of citizens in the countries listed above, Nigeria appears to have dodged a bullet.Even former opponents of the reforms now acknowledge their necessity. The changes, while painful in the short term, are essential to placing Nigeria on a stable economic footing. Though hardship is expected at the outset, these difficulties are temporary, and the long-term benefits are beginning to emerge on the horizon.The easing of harsh economic conditions, made possible by these structural reforms, is paving the way for the opportunities that Nigerians have long awaited. These are the true dividends of democracy, which have been sought since the return to multi-party democracy in 1999—now twenty-six years ago, as marked on May 29.It is because President Tinubu has essentially rescued Nigerians from the kind of socio-economic collapse witnessed in Argentina, Greece, Venezuela, Zambia, and Pakistan, that I confidently declare:“Those Calling Tinubu T-Pain Today Will Hail Him As Baba-T Tomorrow.”This praise will come in recognition of the relief and transformation he is bound to deliver by eliminating the unsustainable subsidies on petrol, electricity, and the naira, amongst other structural deformities hobbling economic growth of our country.In the series I began last week titled, ‘Democracy, GDP Growth, Poverty, and Insecurity in Nigeria’, I sought to explain why high GDP growth does not automatically translate into poverty reduction—a universal phenomenon, not one unique to Nigeria.The tax reform bills recently passed by the National Assembly and currently awaiting President Tinubu’s signature are some of the most pro-poor policies under his administration. One of the four bills will exempt a category of low-income earners—particularly those at the lower rungs of the socioeconomic ladder—from paying personal income tax. At the same time, it increases taxes on the wealthy, especially on luxury items. This reflects a deliberate wealth redistribution policy.The new tax legislation will also incentivize states and cities to attract high-employment-generating businesses to set up operations within their territories. This is because the law provides for a 30% revenue accrual to the state of origin or location of goods and services. Consequently, the business acumen and entrepreneurial orientation of gubernatorial candidates will become increasingly critical in determining who gets elected, as economic strategy will matter more than ever in the governance of Nigerian states. In the US, for instance, states compete to be the host to Tesla, GM, and similar high employment generating corporations.When President Tinubu signs these bills into law—as expected—it will be a significant milestone. To me, the most comforting aspect of the tax reform is its pro-poor orientation. This means Nigerians who are already burdened by the tough but necessary reforms of the Tinubu administration will not be further strained. Instead, the tax base will be expanded in a way that spares the poor while drawing more from those who can afford it.The revised tax regime introduces new rates and bands. Individuals earning below the national minimum wage will be exempt from taxation. Conversely, those earning N50 million and above annually will be subject to progressive increases in their income tax liability.These bills—widely regarded as a game-changer in Nigeria’s tax administration—form a critical part of President Tinubu’s Renewed Hope Agenda aimed at resetting the country’s economic architecture. They also validate a key argument I made in my column last week: that several economic fundamentals must be in place before the benefits of GDP growth can trickle down to the masses.For instance, unless a critical mass of Nigerians understands the link between GDP and poverty reduction, the government can spend a fortune on publicity campaigns touting the administration’s achievements—but many citizens will remain unconvinced. This is because, in the minds of ordinary Nigerians, an increase in GDP is falsely equated with immediate poverty relief. That misunderstanding is what I hope to address through this piece.In truth, GDP growth is a precursor—not an instant solution—to poverty alleviation. It serves as a silver lining or beacon of hope, provided the policies driving the growth are implemented consistently and all other supporting economic conditions are aligned.When Nigerians are equipped with the knowledge that rising GDP does not translate into instant prosperity, their anxiety will subside. They will become less cynical about government pronouncements and more patient as the benefits begin to unfold.On May 8, 2023, during the launch of my book, ‘Leading from the Streets: Media Interventions by a Media Intellectual (1999–2019),’ a panel discussion on Tinubu’s reform policies was held under the theme, ‘Tinubunomics: What’s Working, What’s Not, Why, and the Way Forward.’A striking comment from one of the panelists, Mr. Bala Zaka—an engineer and accountant—went viral. He declared that Nigeria’s economy was “in red, not amber,” painting a bleak picture of the reform trajectory at the time.Today, however, even Tinubu’s fiercest critics acknowledge that, under his deft leadership, economic fundamentals have significantly improved. If we were to use the traffic light metaphor, Nigeria’s economy is now in the amber zone—the transition phase just before green, which symbolizes progress and economic rebound. This implies that while the squeeze caused by reform is still being felt, the country is now on a positive trajectory.However, the public mistakenly believes that government spokespeople are suggesting that the economy is already in the green. This disconnect is what I seek to clarify—to help reduce the rising tension among anxious Nigerians.For example, when I published an article on LinkedIn with the metaphor “the ice is thawing on the Nigerian economy,” many misunderstood me to mean that the storm was over. It led to a wave of criticism and misinterpretation, with some labeling me a Tinubu apologist. It took over a month of continued engagement—using empirical data and economic theory—to clarify the difference between improving economic fundamentals and the lived experiences of ordinary Nigerians.That personal experience reinforces my resolve to continuously invest time in educating the public about the dissonance between macroeconomic recovery and micro-level impact. Just because there is light at the end of the tunnel does not mean we are already basking in its illumination.Therefore, the objective of this piece is to manage expectations. We are not yet at Uhuru—the economy is not fully out of the woods—but we are on the cusp of stability, provided the reforms are sustained and citizens remain patient.Culturally, Nigerians are often accustomed to raising hopes and dashed expectations—not always from politicians, but from everyday interactions. For instance, it’s common for someone who knows they cannot arrive in under three hours to promise they’ll be there in 30 minutes. When the promise is inevitably broken, disappointment ensues. In local parlance, this is known as “African Time,” and it symbolizes overpromising and under delivering.In the political realm, former New York Governor Andrew Cuomo aptly described it as: “Campaign in poetry, govern in prose.”In contrast, in more developed societies, when you apply for a driver’s license or international passport, you are told to expect it in six weeks, knowing that it can be delivered in a shorter time. And often, you receive it in four. Exceeding expectations builds trust.In that context, I advise government officials to refrain from declaring that “the suffering is over”—especially to a public that has long felt alienated from the government, regardless of the administration in power. Instead, we must contextualize the message of hope by reminding Nigerians of where we are coming from and highlighting visible progress