Subsidy Removal Volatility Was Unavoidable, Says Finance Minister Oyedele

The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has stated that the economic volatility which followed the removal of petrol subsidy and the foreign exchange market reforms was unavoidable.

Oyedele made this known in an interview with The African Report. He said the reforms were necessary to fix distortions caused by years of fuel and foreign exchange subsidies.

“If you think about where we started, about three years ago, it was a situation where there was a lot of economic distortion, particularly coming from fuel subsidy, FX subsidy and a lot of other market distortions,” he said.

The minister noted that the government expected short-term pain, including higher fuel prices, transport costs and inflation. “You remove subsidy, fuel prices would go up. Transportation is affected. Logistics is affected. Price pressure, inflation, right? So those things would happen,” he added.

Oyedele, however, said the administration believes the economy has moved past the initial adjustment period. He said the focus is now on growth. Recent indicators show inflation moderating, the foreign exchange rate stabilising, and modest economic expansion.

“We’ve seen moderation in inflation. We’ve seen the foreign exchange rate stabilise. We’ve also seen growth, modest growth, but increasing,” he noted.

The minister acknowledged fresh pressures from global events but said the government’s priority is to turn earlier reforms into real gains. He pointed to investments in power, infrastructure and skills development as critical for sustaining growth. Reforms to improve the business environment will continue.

Oyedele also spoke about tax compliance. He said the government is working on a system that uses enforcement, not just voluntary compliance. “One of the problems is that Nigeria’s political economy still has some very large tax evaders who are almost too powerful to touch. No one should be above the law,” he said.

He added that recent measures target multinational companies, operators in special economic zones, government agencies and high-net-worth individuals. The goal is to improve revenue collection and strengthen public finances.

The minister said the government remains committed to deepening reforms and ensuring that macroeconomic stability benefits businesses and households across the country.