The country is moving in the direction, reckons JOSHUA J. OMOJUWA
Structural transformation is not a synonym for growth, even though the two are routinely confused by some people. An economy grows when it produces more of what it already produces. It transforms when it begins to produce what it previously could not. One speaks to quantity whilst the other addresses capability. Nigeria has spent three years producing a great deal of the first, and the honest question is whether any of the second has followed.
Growth has returned, and it is coming from the part of the economy that employs Nigerians. The National Bureau of Statistics put expansion at 4.43 per cent in the second quarter of this year, the strongest quarterly print in five years. Non-oil growth was 4.31 per cent, in a non-oil sector that is roughly 96 per cent of output. Crude production recovered to 1.72 million barrels a day over the same period without becoming the engine. A commodity economy that grows on its non-commodity side has done something more interesting than get lucky with a price.
The currency has one price. The naira has traded in a band around N1,358 to N1,380, and the parallel market premium that defined the previous decade has effectively closed. That premium was not merely an exchange rate inconvenience. It was a transfer, from the public purse to whoever held access to the official window, and it rewarded proximity to allocation over production.
The state can now pay for itself. Federal revenue rose from N12.3 trillion in 2023 to N28.3 trillion in 2025, with N21.6 trillion collected in the first half of this year alone. Tax to gross domestic product moved from 10.3 per cent to about 13 per cent. None of that came from a new headline tax rate. It came from collection, from the closed arbitrage, and from ending a subsidy that was paid before anything else was paid. Roughly 76 per cent of collections are now non-oil.
And Nigeria mostly refines at home the fuel it used to import. In the first quarter of this year, petrol imports fell to 965.52 million litres from an estimated 2.43 billion litres in the same quarter of 2025, a decline of 60 per cent. Domestic refinery supply rose 59 per cent to 3.18 billion litres, taking the refineries’ share of total petrol supply from 45 per cent to nearly 77 per cent. In value terms, refined petroleum imports fell 87.5 per cent, to 310 million dollars from 2.48 billion. Over that same quarter, Nigeria exported 2.37 billion dollars of refined petroleum.
The same product, moving in opposite directions, inside twelve months.
That is the one item on the list which is structural in the technical sense. The others are price corrections, and a price correction is reversible by the same stroke that made it. A refinery is not. It is physical capital, running at capacity, displacing an import bill that had been Nigeria’s single largest claim on foreign exchange for decades. Everything else on the list describes an economy that stopped doing something foolish. This one describes an economy that started being able to do something.
On the measure economists actually use for structural transformation, Nigeria has started to move. The Harvard Growth Lab ranks countries by economic complexity, which is the diversity of what they make weighted by how few others can make it. Nigeria sits near 150th, in the lowest tenth of measured economies. In essence, plenty room for growth. Oil and oil products were about 88 per cent of exports in 2024, in a year when the oil sector was about 5 per cent of real output. Everything Nigeria sells abroad that is not crude came to over 6 billion dollars in 2025. A record.
The current account tells the same story in a different context. The surplus is real and it is large, 7.5 per cent of output in 2024 and more than 12 billion dollars in the first half of this year. But consider what produced it. Diaspora transfers were 24 billion dollars in 2024 and 11.12 billion dollars in the first half of this year. Strip them and the account is in deficit. The services deficit, meanwhile, has not budged. Nigerians still buy foreign education, foreign medical care, foreign freight and foreign insurance at a rate that three years of currency adjustment has not touched.
So the answer to the question in the headline is no, not yet. Not on the definition. But we are going in that direction.
Transformation is not something a fiscal instrument delivers. It is built inside firms, over a decade or more, from accumulated capability. What policy decides is whether building it is rational. For most of the last twenty years it was not. When the currency had two prices, the highest return in Nigeria was arbitrage. When petrol was subsidised, the highest return was smuggling it. Capital went where the returns were, and the returns were in extraction rather than production. Correcting those prices transforms nothing by itself. It simply stops punishing the people who would.
PwC’s survey in the second half of this year finds household sentiment still well behind the aggregates, which is the expected signature of an adjustment that cut real incomes before it produced anything to distribute. The International Monetary Fund puts debt service at 53.7 per cent of federal revenue. More than half of what the federation earns is committed to the past before the present in form of budget allocations to our pressing needs. That is the binding constraint on how quickly the first problem can be solved, and no reserve figure answers it.
Which gives us the test for the next phase, and it is not a growth rate. It is whether the non-oil export number moves. Over six billion dollars is the measure of what Nigeria can currently make that somebody abroad wants to buy. Watch that figure. When the Nigerian economy attains full transformation, that number will tell most of the story. We can and must do a lot more on this front. Our prosperity depends on it.
Omojuwa is chief strategist, Alpha Reach/BGX Publishing