LAGOS, Oct 21 – Nigeria plans to rely increasingly on domestic and foreign private capital to finance its next phase of economic growth, rather than depend on additional government borrowing, Finance Minister Taiwo Oyedele said on Wednesday.
Speaking at an event hosted by think tank Chatham House, Oyedele said the government intended to attract private investment while strengthening public finances and maintaining its programme of economic reforms.
“The next phase of growth will be financed by private capital, domestic and foreign, and not by the state borrowing more,” Oyedele said.
He added that Nigeria had been living on “borrowed money, and increasingly, borrowed time”, but that this was coming to an end.
The remarks signal the government’s intention to place a greater share of the burden for financing economic expansion on private investors, both within Nigeria and internationally, as it seeks to reduce reliance on public borrowing.
Government Rules Out Return of Petrol Subsidies
Oyedele ruled out restoring petrol subsidies, reaffirming a central element of President Bola Tinubu’s economic reform programme. “The petrol subsidy is gone and it is staying gone,” he said.
Since taking office in 2023, Tinubu has introduced sweeping reforms, including the removal of petrol subsidies and changes to the foreign exchange regime. The measures have helped stabilise public finances, strengthen foreign reserves and attract investment, according to the government’s assessment.
However, the reforms have also intensified cost-of-living pressures, leaving policymakers with the challenge of translating improved macroeconomic conditions into stronger economic growth, employment and higher household incomes.
Oyedele said the government’s approach to protecting vulnerable households would centre on economic and wage growth, alongside targeted assistance.
He said approximately 10 million households were receiving support through the government’s cash transfer programme. “Even though you’re promising a better future, they have to be alive to see it,” he said.
The remarks highlight the tension between maintaining fiscal reforms and addressing the immediate effects of higher living costs on households.
Inflation Declines as Government Seeks Further Disinflation
Oyedele said inflation had fallen to 14.63% from 21% a year earlier, but argued that further reductions were necessary. He said inflation needed to reach “low single digits over the next coming months.”
Sustained disinflation would be important to restoring household purchasing power and improving the environment for investment. However, the pace of further declines will affect the economic outlook for consumers and businesses.
The government is seeking to combine price stability with stronger output growth, while avoiding a return to broad-based fuel subsidies that would increase pressure on public finances.
Nigeria Sets 7% Growth Ambition
The International Monetary Fund forecasts Nigeria’s economy will grow by 4.2% in 2026 and 4.3% in 2027. Oyedele described the projections as “too conservative”, saying the government was targeting average annual growth of approximately 7% over the next five years.
Achieving that ambition would require growth to accelerate beyond the IMF’s current projections, with greater private investment expected to play a central role.
The government’s strategy places emphasis on mobilising capital from domestic investors and international markets rather than relying on additional sovereign borrowing to finance expansion.
Private capital could support investment across productive sectors, although the scale of its contribution will depend on investor confidence, the operating environment and the availability of viable projects.
Fiscal Responsibilities and Revenue Generation
Oyedele also said the government was working to transfer more responsibilities to state governments while improving the federal government’s ability to generate revenue without placing additional burdens on the population.
The proposed approach points to a broader effort to improve revenue mobilisation and the allocation of public responsibilities across Nigeria’s different levels of government.
For the federal government, the challenge is to strengthen revenue generation while maintaining fiscal discipline and supporting economic activity. At the same time, the states will need the capacity to manage additional responsibilities and deliver public services.
Nigeria’s next phase of reform will therefore depend not only on attracting private investment, but also on sustaining lower inflation, improving household welfare and translating macroeconomic stabilisation into stronger and more inclusive growth.
