ABUJA — Foreign exchange reforms implemented by President Bola Tinubu’s administration have been critical to restoring stability to Nigeria’s economy, Executive Chairman of the Nigeria Revenue Service (NRS), Zacch Adedeji, has said.
Speaking on Channels Television’s Sunday Politics, Adedeji said the FX reforms, alongside the removal of petrol subsidy, were necessary to address structural distortions inherited by the administration and establish a more sustainable economic framework.
He said the government assumed office with an economy characterised by multiple exchange-rate windows, an unsustainable fuel subsidy regime, weak oil-sector performance and a narrow revenue base.
According to him, the decision to unify the foreign exchange market was particularly important because multiple exchange-rate windows had distorted economic transactions and made it difficult to determine the true value of transactions.
Adedeji acknowledged that the reforms initially created significant pressure for households and businesses but argued that they were beginning to produce changes in the structure of the economy.
He linked the reforms to increased domestic refining capacity and higher government revenue, saying domestic refining capacity had risen from about 30,000 barrels per day before the reforms to approximately 700,000 barrels per day.
He also said government revenue had increased from roughly N12 trillion to N40 trillion, attributing the rise to stronger revenue mobilisation and broader economic reforms.
Adedeji said the government’s revenue strategy was not designed simply to increase the tax burden on Nigerians but to expand economic activity and generate higher revenues as businesses and households become more prosperous.
“We are taxing prosperity, not poverty,” he said.
Tax reforms target broader economic base
The NRS chairman defended the administration’s tax reforms, saying broadening the tax base would help create a more sustainable fiscal system and reduce dependence on a relatively small pool of taxpayers.
He said the reforms should be viewed alongside measures targeting electricity, infrastructure, education, agriculture and access to credit.
On electricity, Adedeji cited the Electricity Act as an example of efforts to restructure the power sector by allowing states to play a greater role and creating opportunities for investment.
He argued that improved electricity supply would reduce production costs and enhance the competitiveness of Nigerian businesses.
Infrastructure and industrial investment
Adedeji also defended government spending on major infrastructure projects, stressing the need to distinguish between budgetary provisions and actual funding.
He said government resources had to be prioritised for projects capable of generating long-term economic benefits, citing the Lagos-Calabar Coastal Highway and Sokoto-Badagry Expressway as examples.
According to him, infrastructure investment can stimulate economic activity through construction, job creation and increased demand for goods and services.
He added that the government was supporting agriculture and industrial development through institutions including the Bank of Agriculture and Bank of Industry, with the aim of expanding production and improving access to finance.
While acknowledging the economic hardship that followed the reforms, Adedeji said the administration was now focused on consolidating the gains from the adjustment process and building a more sustainable economic foundation.
