Olayemi Cardoso :The Only Man Who Can Secure Second Term For Tinubu
By Amos Adetunji
For President Bola Ahmed Tinubu’s critics, it is a foregone conclusion that he must be unseated in 2027 . This is not a mere joke. A powerful political coalition has been forged to drive this initiative forward ; close allies of the president have been hijacked to ease the penetration of his stronghold . Though he has allegedly committed a litany of sins, his number one and most critical crime is the outrageous and persistent increases in prices of good and services , a factor acting as a ticking time bomb and putting Nigeria’s economy in a precarious state. They contend that the skyrocketing cost of living has put Nigerians’ welfare in jeopardy, and that the electorate’s verdict on Tinubu’s economic handling will determine his political future.With that, they believe, it will seal his fate in 2027.
Truly ,the raging storm in the economic landscape is strong . Nigeria’s headline inflation rate has been on a fluctuating trend over the last two years, with a recent peak of 34.19% in June 2024, marking a 28-year high. This rate represents a significant increase from the previous year, with a year-on-year rise of 11.40% points. The inflation rate has been driven by various factors, including food inflation, which reached 40.9% year-on-year in June 2024, and core inflation, which increased to 27.4% during the same period.The fluctuations in inflation rates, with increases in some months and decreases in others, suggest that the economy is experiencing volatility. With the current rate remaining significantly higher than the previous year, it is crucial for policymakers to implement effective measures to control inflation and stabilize the economy. The impact of inflation on the lives of Nigerians, particularly the most vulnerable populations, cannot be overstated, and urgent action is needed to mitigate its effects.
Critics are sharpening their knives, attributing Nigeria’s inflation surge to President Tinubu’s policies, particularly the removal of fuel subsidies and the Central Bank’s managed float exchange rate policy, which has led to a depreciation of the naira and fueled inflation. This potent issue is being exploited in their bid to unseat him in 2027.
The opposition has astutely deciphered the electorate’s mandate, reading the tea leaves with unerring precision. As Nigeria’s electoral season gains momentum, one thing is clear: the voters are not impressed by grandstanding or empty promises. Instead, they are driven by frustration and a deep-seated desire for real change. They want jobs, visible signs of economic growth, and a leader who is patently in command. They long to recover their confidence in the nation’s future and believe that their leaders can deliver. The themes run together – economic stability, social cohesion, and moral leadership – and Nigerians are looking for a leader who can address these pressing issues. The question is, who can deliver? Can Nigeria’s leaders set right the failings of the past and chart a new course for the future? The voters are registering in record numbers, eager to make a choice that will determine the course of the country’s history. It’s time for leaders to prove themselves, to show that they can deliver on the promises and meet the expectations of the Nigerian people.
No doubt about it ,inflation can have far-reaching consequences for economic growth and stability, distorting the price mechanism and creating uncertainty. One of the primary ways in which inflation affects the economy is by obscuring relative price changes, leading to misallocation of resources. For example, if apple prices rise by 20% due to inflation, but plum prices also rise by 15%, it may be difficult to determine whether apples are becoming more expensive relative to plums.
The relationship between inflation and growth is complex and influenced by various factors. While high inflation can be detrimental to growth, the evidence suggests that the relationship is not straightforward. Studies have shown that countries with high inflation rates do not always experience slower growth. In fact, some countries have experienced rapid economic growth despite high inflation rates.
However, the link between inflation and unemployment is more clear-cut. Countries with low inflation rates tend to have lower jobless rates. Econometric studies have also found that reducing inflation can have a positive impact on growth, with a reduction in the inflation rate by one percentage point increasing the annual growth rate by one-tenth of a percentage
However , to the president’s admirers ,the critics are just being mischievous . To them , the government had no better option with the economy in a comatose as at that time . When President Tinubu assumed office in May 2023, Nigeria’s economy had a growth rate of 2.31% in the first quarter of 2023, with a public debt of ₦49.85 trillion, a headline inflation rate of 22.41%, and food inflation at 24.82% year-on-year. The debt service-to-revenue ratio was approximately 97%, indicating that about 97% of the country’s revenue went towards servicing its debt.
The CBN lent a total of N22.8 trillion to the federal government via Ways and Means as of September 2022, according to Emefiele, with a Senate probe investigating a N30 trillion Ways and Means loan under his tenure. Despite these challenges, the government has set ambitious targets to tackle inflation, aiming for 21% in 2024 and 15% in 2025.
Despite the precarious status of the economy when Tinubu”s government assumed the office , his admirers claimed , it has continued the battle for the soul of the economy and economy has been stabilized . To achieve this goal, the CBN has employed various strategies, including adjusting interest rates, stabilizing the foreign exchange market, and improving food production to drive economic growth. The CBN’s commitment to orthodox monetary policies has played a crucial role in curbing inflation, and its efforts to stabilize the Naira, attract foreign investment, and improve financial inclusion have contributed to a more stable economic environment.
Nigeria’s inflation rate has shown a modest decline, easing to 22.22% in June 2025, down from 22.97% in May 2025. This decrease signals a slowdown in the pace of rising consumer prices across the country. On a year-on-year basis, the headline inflation rate was 11.97% lower than the rate recorded in June 2024, which stood at 34.19%. Although the month-on-month inflation rate rose to 1.68% in June 2025, up by 0.15 percentage points from May 2025, food and core inflation rates both experienced declines. The food inflation rate dropped significantly to 21.97% in June 2025, down from 40.87% in June 2024, while the core inflation rate decreased to 22.76% from 27.4% over the same period. These numbers indicate a positive trend, but inflation rates can fluctuate frequently, so it’s essential to check the National Bureau of Statistics or Central Bank of Nigeria’s official websites for the most recent data.
The Tinubu administration, bolstered by the economic genius of Wale Edun, has achieved a remarkable turnaround in Nigeria’s financial sector. In just two years, the government has reduced the budget deficit from nearly 100% of total revenue to less than 25%, and debt service to revenue ratio has plummeted from over 100% to under 40%. The net external reserve has skyrocketed from $4 billion to over $40 billion, despite paying off $8 billion in FX backlog and $3 billion in IMF debt. Additionally, tax reforms have yielded impressive results, with the tax-to-GDP ratio increasing from 10% to 13.5% and record-breaking tax collections from FIRS and Customs Service.
These economic reforms, described as the most audacious in Nigeria’s history by Bloomberg, have transformed the country’s economy into an unending growth trajectory. With an average growth rate of over 3.4% in two years, compared to below 3% in the preceding eight years, Nigeria’s economic prospects look brighter than ever. The success of the Tinubu administration’s economic policies can be attributed to the President’s finance and account background, as well as the expertise of Minister Wale Edun. As global economic rating agencies upgrade Nigeria’s economic rating to its best in over 30 years, it’s clear that the country’s financial future is looking up.
Despite the above sterling performance,one thing is clear: there is no respite yet on the horizon, and many things have to be gotten right , particularly the fact that the debate over inflation is complex, with no clear consensus on the ideal inflation rate. Not only that ,the issue of price stability, another critical success factor , also remains elusive .
Meanwhile, all eyes are on Olayemi Cardoso, the CBN governor, who holds the key to averting this economic crisis with the monetary policy tools at his disposal. Can he steer the economy back on track, or will critics succeed in making inflation a decisive factor in the next election? This may not be farfetched going by his mandates as the CBN governor . Though the removal of fuel subsidy is a fiscal affair , the management of the inflationary effect of it, like that of the merger of the foreign exchange markets, rest squarely on Cardoso’s shoulders. Both the removal of subsidy and the merger of the foreign exchange market are nothing but a complete harakiri .
The question remains : how far can Cardoso go in driving down the rate of inflation as well as ensuring price stability before 2027 ? Only by achieving an inflation and price stability that are suitable for the economic welfare of the electorates who are waiting to judge the president’s second term ambition on his performance , could the coast be cleared for the president’s victory at the poll in 2027 .
To achieve this , certain things have to be resolved. The first is for Cardoso to find the ideal level of inflation for economic growth and achieve an appropriate cost of price stability .
Achieving the ideal level of inflation for economic growth
The debate over inflation is complex, with policymakers and economists divided on the ideal level of inflation for economic growth. While most agree that double-digit inflation is detrimental, the question remains: how far down should inflation be pushed? Some argue that zero inflation is the ideal target, believing that price stability would lay the foundation for faster growth, enable more informed decision-making, and eliminate distortions caused by inflation. Others, however, contend that a low, stable inflation rate is more beneficial, as it allows for relative prices and wages to adjust more efficiently and leaves open the possibility of negative real interest rates to help pull an economy out of depression.
The experience of industrial countries in the 1960s, where inflation decreased to around 3%, sparked a debate about the ideal inflation rate. Some policymakers pushed for complete elimination of inflation, while others argued that a “little dose of inflation” was necessary to reduce real debt burdens and stimulate growth. Critics also pointed out that reducing inflation to zero might come at the cost of temporary increases in unemployment and reduced economic growth.
Recently, some economists have challenged the notion that eliminating inflation is necessary, arguing that stabilizing the inflation rate is more important than its level. According to this view, stabilizing inflation makes it easier to predict and less harmful. However, data suggests that countries with the lowest inflation rates have also had the most stable inflation rates, creating a virtuous circle of low inflationary expectations.
Many countries have set ambitious targets to reduce inflation to 2% or less, with some aiming for price stability. Proponents argue that this would lead to the fastest long-term growth. However, others argue that a little inflation can be healthy, or that the costs of reducing inflation to zero outweigh the benefits. Ultimately, policymakers must balance the potential benefits of low inflation with the potential costs of reducing economic growth, navigating complex trade-offs to promote sustainable economic growth.
The question of how low is low enough remains a matter of debate. While some argue that 2-3% inflation is optimal, others believe that even lower rates are necessary. As countries strive to achieve price stability, understanding the historical context of inflation and the potential benefits and costs of price stability will be crucial for making informed decisions that promote sustainable economic growth.
Achieving Price Stability
The pursuit of price stability is a complex and challenging process, with policymakers facing significant short-term costs. One of the primary costs of achieving price stability is the temporary increase in unemployment, resulting from the slow pace of change in expectations and built-in assumptions of continuing inflation. For instance, workers expect annual pay increases in line with last year’s inflation rate, and home-owners may have borrowed heavily to buy a house in the expectation that inflation will erode the real weight of their mortgages. If inflation suddenly falls, these individuals may be struck with a burden of debt bigger than they expected.
Moreover, the process of disinflation can be self-defeating if not managed carefully. A study by Stephen King argues that zero inflation is currently an impossible goal for some countries, given the short-term costs of disinflation. Despite these challenges, the benefits of price stability can be significant, including the elimination of many unproductive activities and the promotion of economic growth.
To reduce the costs of disinflation, governments should focus on implementing policies that tackle institutional rigidities and wean firms and workers off their inflationary habits. One crucial step is to make anti-inflationary policy fully credible, which can be achieved by removing the temptation for politicians to give the economy a short-term stimulus. Making central banks independent is a key part of this process, allowing them to focus on long-term price stability rather than short-term political gains.
Not doubt about it , achieving price stability is a challenging process that requires careful consideration of the potential costs and benefits. Policymakers must be patient and committed to achieving this goal, and implement policies that support price stability and promote sustainable economic growth. By understanding the complex relationship between inflation and growth, policymakers can make informed decisions that promote economic stability and prosperity. Can Cardoso live up to the above challenges to secure the much needed second term for Tinubu ? time will tell .
