Reform, Accumulation and the Democratic Question: Interrogating Nigeria’s Post-2023 Political Economy

By Olugbesan Idris, Ph.D.

President Bola Ahmed Tinubu’s 2026 Independence Day address, framed around the transition “From Reform to Prosperity,” should be understood as more than an account of macroeconomic performance. It represents an attempt to construct a particular interpretation of Nigeria’s post-2023 political economy: one in which the severe dislocations associated with reform are retrospectively situated within a larger narrative of structural correction and prospective prosperity.

The President’s metaphor of Nigeria having “passed through our own Red Sea” is therefore politically consequential. It casts the hardships accompanying subsidy removal, exchange-rate liberalisation and fiscal restructuring as the costs of escaping an allegedly unsustainable economic order, while projecting a future in which stabilisation will translate into investment, production and improved living standards.

Yet political economy demands a more exacting interrogation. The central question is not simply whether the reforms have corrected selected macroeconomic distortions, but what kind of economic order they are producing. What regime of accumulation is emerging? Which classes and fractions of capital benefit from the new configuration? Which rents are being dismantled, and which new opportunities for rent extraction may be arising? Has the Nigerian state acquired greater developmental capacity, or primarily greater fiscal discipline? And can economic restructuring acquire durable legitimacy without strengthening the democratic agency of the citizens who bear its costs?

These questions place the Tinubu reforms within a much longer history.

Beyond the Immediate Crisis

Nigeria’s contemporary economic predicament cannot be reduced to the policy failures of any single administration. It is the accumulated consequence of colonial extraction, postcolonial state formation, dependent accumulation, oil rentierism, weak productive capacity, technological dependence and persistent struggles over the distribution of national surplus.

Colonial rule incorporated Nigeria into an international division of labour principally organised around the extraction of commodities and the supply of primary products to external markets. Political independence transferred juridical sovereignty without automatically transforming the economic structures through which accumulation occurred. The postcolonial state inherited an economy whose productive architecture remained externally oriented and whose technological and financial capabilities were unevenly developed.

This historical inheritance makes the insights of Claude Ake, Okwudiba Nnoli, Dani Nabudere, Yash Tandon, Ali Mazrui and Immanuel Wallerstein particularly relevant. Their theoretical traditions differ considerably, yet they converge on a fundamental proposition: African underdevelopment cannot be adequately explained as an internally generated deficiency detached from the structures of global capitalism.

Formal sovereignty does not necessarily produce substantive economic autonomy. International finance, technological dependence, commodity markets, foreign capital and unequal patterns of trade continue to circumscribe the policy space available to developing economies.

Wallerstein’s world-systems perspective is especially pertinent. An economy may experience periods of growth, attract substantial foreign investment and increase its export earnings without fundamentally altering its structural position within the international division of labour. The developmental question is therefore not merely whether Nigeria grows, but whether the pattern of accumulation enables it to acquire technological capabilities, diversify production, deepen domestic value chains and strengthen its bargaining position within global markets.

This also exposes the limitations of applying classical modernisation theory mechanically to a postcolonial economy. Adam Smith’s insights into the division of labour and productivity remain indispensable, while J.S. Mill’s treatment of accumulation highlights the importance of expanding productive capacity. But Nigeria is not reproducing the historical trajectory through which nineteenth-century European economies industrialised. It is attempting to transform its productive structure within a global economy whose technological hierarchies, financial institutions and transnational production networks are already deeply entrenched.

The task, therefore, is not simply to “modernise” by integrating more deeply into global markets. It is to alter the terms upon which that integration occurs.

Reform and the Problem of Accumulation
The Tinubu programme contains a recognisable market-oriented component: petroleum-subsidy removal, exchange-rate liberalisation, fiscal consolidation, greater reliance on market pricing and an enlarged role for private investment.

The economic rationale is intelligible.

Administratively determined prices can generate distortions; multiple exchange rates can encourage arbitrage; poorly targeted subsidies can create fiscal pressures; and persistent deficits can constrain public investment.

Yet correcting distortions in the price system is not equivalent to transforming the productive system.

Exchange-rate liberalisation does not, by itself, generate technological capabilities. Subsidy removal does not automatically produce industrial capacity. Fiscal consolidation cannot substitute for reliable electricity, efficient transport infrastructure, human-capital development or long-term industrial finance.

The decisive analytical distinction is therefore between macroeconomic reconstitution and productive transformation.

The former concerns the fiscal, monetary and pricing conditions under which economic actors operate. The latter concerns what an economy produces, how it produces it, the technological capabilities embedded in production, and how the resulting surplus is distributed.

A successful reform programme must ultimately connect the two.

This is where developmental-state theory becomes relevant. Nigeria does not require the disappearance of the state into an unrestricted market order, nor does it require a comprehensive command economy. What it requires is a state capable of coordinating infrastructure, finance, energy, technology, labour and industrial policy while maintaining sufficient institutional autonomy to discipline predatory interests.

Such a state must be neither captive to capital nor hostile to it. Its function is to shape the conditions under which productive capital can emerge, expand and acquire internationally competitive capabilities.

The Political Economy of Rent

Economic reform is never distributionally neutral. It alters the allocation of risks, rents and opportunities among competing social forces.

Subsidy removal changes the relationship between the state, consumers and businesses. Exchange-rate reform redistributes advantages and costs among importers, exporters and domestic producers. Infrastructure expenditure creates new opportunities for private accumulation. Public procurement determines which firms obtain access to state-generated markets. Credit policy influences which sectors can expand and which remain marginal.

The fundamental question is therefore whether Nigeria is escaping rentierism or merely reorganising it.

The disappearance of one rent does not necessarily mean the disappearance of rent extraction. A petroleum subsidy may be dismantled while new forms of financial, contractual, infrastructural or regulatory rent emerge elsewhere in the economy. The relevant issue is whether such changes are accompanied by an expansion of productive capabilities.

If rents are increasingly channelled towards infrastructure, technological acquisition, industrial learning and productive investment, they may contribute to developmental accumulation. If they instead reproduce opportunities for politically mediated wealth extraction, the institutional form of rentierism may change without its underlying logic being displaced.

Nnoli’s political sociology remains instructive here. Economic distribution cannot be divorced from the social organisation of the state, including class interests, regional constituencies, institutional power and unequal access to public resources.

Every serious evaluation of reform must therefore ask several elementary but consequential questions: Who bears the costs of adjustment? Who captures the resulting surplus? Who controls productive finance? Who owns productive assets? Who receives public contracts? And what institutional mechanisms determine the allocation of economic opportunity?

These are not peripheral questions. They are the substance of political economy.
Stabilisation and the Problem of Demand
A further complication arises from the predominantly supply-oriented conception of prosperity embedded in the reform narrative.

Lower production costs, improved infrastructure, energy availability, agricultural productivity and increased private investment are expected to expand supply and ultimately moderate prices.

That proposition has economic logic, but productive capacity does not automatically guarantee adequate effective demand.

In a low-income economy, sustained erosion of household purchasing power can weaken consumption, discourage investment and constrain the very expansion of production that reform seeks to stimulate. Macroeconomic stability must therefore be reconciled with social reproduction.

Social transfers, public employment, healthcare, education and basic infrastructure should not be regarded exclusively as compensatory mechanisms for the casualties of adjustment. Properly designed, they can sustain demand while expanding human capabilities and labour productivity.

The objective, however, should not be the permanent administration of deprivation. Social protection becomes developmentally meaningful when it connects citizens to productive opportunity through education, skills, employment, entrepreneurship, infrastructure and access to markets.

The same principle applies to agriculture.
Mechanisation, irrigation, improved seeds and fertiliser can raise agricultural productivity, but their transformative effect depends upon the existence of storage, transport, processing, finance, market access and industrial linkages. Nigeria therefore needs an agro-industrial strategy rather than a policy architecture that leaves agricultural producers trapped at the lowest-value end of the commodity chain.

From Resources to Capabilities
Natural resources present an analogous challenge.

Nigeria’s gas reserves, for instance, should not be conceived merely as exportable commodities. Their developmental significance lies partly in their capacity to support electricity generation, fertiliser production, petrochemicals, manufacturing and other energy-intensive industries.

The strategic objective should be movement from resource extraction towards resource-based industrialisation.

The distinction is critical. Exporting crude petroleum generates revenue; developing refining, petrochemicals, engineering services and associated manufacturing creates capabilities. Exporting agricultural commodities generates foreign exchange; processing them domestically can generate employment, technological learning and higher domestic value added.

This is where Yash Tandon’s critique of the global political economy becomes relevant. The question should not simply be how much foreign capital enters Nigeria or how much the country exports. It should be how much domestic productive capability those flows create.

A cocoa-exporting economy occupies a different structural position from one capable of producing internationally competitive chocolate products. An oil exporter occupies a different position from an economy possessing deep refining, petrochemical, engineering and technological capabilities.

Nigeria therefore requires strategic interdependence rather than autarky: integration into the world economy from a position of progressively greater productive capacity and bargaining power.

Foreign investment should consequently be assessed not only by its volume, but by its contribution to technology transfer, domestic supply chains, skilled employment, local capability formation and long-term capital accumulation. Similarly, the expansion of non-oil exports should be evaluated through domestic value added, technological sophistication and export complexity rather than volume alone.

The Developmental State and Democratic Citizenship

Ali Mazrui’s reflections on African modernity reinforce another important proposition: development should not be reduced to the wholesale transplantation of institutional models developed elsewhere.

Nigeria’s modernisation must be historically grounded and institutionally adaptive. Technological advancement, industrial expansion and global integration must be reconciled with domestic social realities and African institutional experience.

The African Continental Free Trade Area creates an important strategic possibility in this regard. Nigeria’s enormous domestic market could serve not merely as a destination for imports but as a platform for continental industrial expansion, provided domestic firms acquire the productive capabilities necessary to compete beyond national borders.

But no developmental project can be sustained indefinitely without political legitimacy.
This is where Claude Ake’s contribution becomes especially significant. His work challenges the artificial separation of development from political power and rejects the assumption that democracy is an institutional luxury to be postponed until after economic transformation.

Economic growth and democratic deepening do not automatically reinforce one another. States can expand infrastructure, attract investment and improve administrative capacity while simultaneously exhibiting varying degrees of political exclusion. Kenya’s recent experience, including the political controversy surrounding its 2024 Finance Bill, illustrates the tensions that can arise when fiscal and economic reform encounters popular resistance.

Yet the converse proposition is equally important: democracy possesses value beyond its contribution to economic efficiency.
Citizens are not simply consumers of public policy, units of labour or beneficiaries of government expenditure. They are political subjects entitled to participate in determining the institutional arrangements under which economic resources and social opportunities are distributed.

This makes democratic accountability part of the developmental question itself.
Legislative scrutiny, judicial independence, credible elections, civil-society participation, media freedom and institutional transparency provide mechanisms through which policy can be contested, corrected and legitimised.

Democracy does not guarantee development. Neither does economic growth guarantee democracy. The challenge is to construct institutions in which economic transformation and democratic citizenship reinforce rather than undermine one another.

The 2027 Democratic Test

The 2027 electoral cycle will therefore acquire significance beyond the question of political succession. It will provide an arena in which competing interpretations of Nigeria’s post-2023 economic trajectory are likely to be contested.

Inflation, household purchasing power, employment, insecurity, debt, exchange-rate management, industrialisation, energy, agricultural productivity and social protection will inevitably become questions of political legitimacy.

The critical democratic issue should not be reduced to personalities. It should concern the competing political-economic projects advanced by political actors: the role assigned to the state, the relationship between public and private capital, the distributional consequences of fiscal policy, the treatment of labour and social protection, the organisation of industrial policy and the conception of Nigeria’s economic sovereignty.

The deeper question is therefore not simply who controls the state, but what kind of state is being constructed and in whose interests its institutional capacities are deployed.

A developmental state requires bureaucratic competence, strategic coherence and insulation from predatory rent-seeking. But it also requires democratic legitimacy.
The state must possess enough autonomy to discipline capital without becoming autonomous from citizens; enough capacity to plan without converting planning into patronage; enough fiscal discipline to preserve macroeconomic credibility without imposing socially destructive adjustment; and enough confidence in markets to harness private initiative while retaining the institutional capacity to intervene where markets fail to produce structural transformation.

This is a difficult equilibrium. But it is precisely the difficulty that makes developmental politics a question of institutional design rather than ideological preference.
From Adjustment to Developmental Transformation

The post-2023 reforms should therefore be interpreted neither as an uncomplicated success nor as an unqualified failure. They constitute a significant attempt to reconfigure Nigeria’s macroeconomic architecture. Their historical significance, however, will depend upon what follows from that reconfiguration.
Stabilisation is a condition of development, not its final objective.

The decisive question is whether Nigeria can move from an accumulation structure heavily characterised by oil dependence, import vulnerability, state-mediated contracting, financial intermediation and rent extraction towards one increasingly anchored in manufacturing, agro-industrialisation, technological innovation, productive finance, sophisticated exports and human-capital formation.

That transformation cannot be achieved by monetary or fiscal reform alone. It requires institutional coordination across energy, transport, finance, education, technology, agriculture and industry. It requires long-term investment horizons and credible rules. It requires a state capable of rewarding productive risk while penalising rent-seeking. And it requires political institutions capable of subjecting developmental strategy to democratic scrutiny.

The strategic objectives are consequently broader than making Nigeria merely “investable.” The country must become more productive; not merely more attractive to foreign capital, but more capable of domestic capital formation; not merely a larger exporter, but a higher-value producer; not merely less inflationary, but capable of restoring and sustaining real purchasing power; and not merely electorally competitive, but institutionally more democratic.

The appropriate conceptual destination is therefore neither laissez-faire neoliberalism nor state dirigisme. It is a form of democratic developmentalism: an economic order in which macroeconomic stability provides the foundation for structural transformation, while public institutions coordinate investment in infrastructure, energy, technology, industrial finance, agriculture and human capabilities.
Such a framework would seek economic sovereignty without autarky, international integration without structural dependency, productive growth without exclusion, and state capacity without democratic subordination.

Tinubu’s Red Sea metaphor is consequently best understood as transitional rather than terminal.

The Red Sea is not the Promised Land.
Macroeconomic stabilisation is not prosperity. Growth is not structural transformation. Investment is not development. Exports are not economic sovereignty. Nor are elections, by themselves, equivalent to democratic citizenship.

The historical challenge is to connect these dimensions.

Nigeria possesses considerable demographic weight, natural resources, entrepreneurial energy and strategic geographic importance.

The unresolved question is whether these assets can be reorganised through institutions capable of converting economic potential into durable productive capability while ensuring that the benefits of transformation are broadly distributed and politically accountable.
That is the deeper test of the post-2023 reform trajectory.

The question before Nigeria is therefore larger than whether the country has crossed the Red Sea. It is whether, on the other side, it can construct a political economy in which production, distribution and political power are sufficiently reconfigured that prosperity ceases to function primarily as a presidential promise and becomes a durable social condition.