In the days before and after the handover, the British Broadcasting Corporation (BBC) examined Buhari's legacy, describing it as one of “kidnapping, inflation and debt”.
The UK’s public broadcaster also looked at the challenges Tinubu would face in his new role. In these reports on the transition, the BBC made a number of claims. We checked 15 of them, specifically on the economy, for accuracy.
Despite being a major oil exporter, Nigeria imports nearly all its fuel due to a lack of refining capacity.
The BBC described the subsidy, where the government pays the difference between the price it sets and the cost of importing oil, as a “huge drain on public finances”.
But did the country spend N4.3-trillion subsidising fuel in 2022?
Yes. In April 2022, the Nigerian senate approved a revised budget of N4-trillion to pay fuel subsidies for the year. Buhari said the rise in oil prices due to the Russia-Ukraine war was behind the increase in funding requested.
Buhari's government intended to remove fuel subsidies in 2022. But it suspended the plan in January that year, citing what the finance minister called “problematic” timing in the face of planned protests. The deadline was pushed back by 18 months.
The minister, Zainab Ahmed, publicly stated on several occasions that N3.36-trillion had been set aside for the fuel subsidy in Nigeria's 2023 budget to cover subsidy payments for the first six months only, with the 18-month extension ending in June 2023. – Allwell Okpi
Inflation is a measure of how the prices of a basket of commonly used goods and services have risen over time, usually a year. An increase in prices affects the cost of living because people have to pay more for those goods and services, even though no additional items have been added to the basket. Essentially, it reduces the value of your money or your purchasing power.
Fixing the economy would be daunting even for a trained accountant like Tinubu, said the BBC, because “things have never looked worse for Nigeria”. The article cited inflation “at a record 22%” as evidence.
The central bank has records from January 2003 to April 2023. We did not find rates from earlier than that. But this data shows that inflation was higher in August 2005, when it was measured at 28.2%.
Indeed, from January 2003 to date, inflation rates above 22.2% have been recorded for eight different months.
Inflation influenced by insecurity and other non-economic factors
Inflation in Nigeria is caused by non-economic factors rather than economic factors related to supply and demand, Gafar Ijaiya, a professor of economics at the University of Ilorin in north-central Nigeria, told Africa Check.
“The current rise in the rate of inflation has to do with factors such as insecurity, which means that many farmers are unable to go to their farms and produce food, and traders are also afraid to travel to some parts of the country.
“There is also the difficulty of transporting goods due to bad roads, high costs and extortion by touts and security agents. All these add to the price final consumers pay for the goods,” Ijaiya said.
“Now that fuel subsidy has been removed and the price of fuel has jumped from less than N200 to over N500, the rate of inflation will continue to rise, at least in the short-term. The price of fuel affects the price of most goods and services in the country,” he added. –Allwell Okpi
Continuing their bleak assessment of Nigeria’s present situation, the BBC claimed that “one in three are unemployed”.
Nigeria’s population is estimated at more than 200-million people.
The latest unemployment rate published by the country’s national statistics office dates from the fourth quarter of 2020, when it was 33.3%. That was around 23.19-million people. (In a related report the broadcaster said that “currently one in three Nigerians who want to work are unable to find a job”.)
To arrive at this figure, the NBS considered as unemployed those aged between 15 and 64 who were available for work and actively seeking a job.
A person was also considered to be unemployed if they had had less than 20 hours of work in the week prior to the labour force survey. Full-time students and those who chose to stay at home or were ill and unable to work were not counted as unemployed.
Unemployment measure has changed since 2020
Baba Madu, the head of the national accounts at the NBS, confirmed that the 33.3% unemployment rate in the last published survey could not be interpreted as one in three Nigerians being unemployed, noting that the measurement had changed.
“What’s important is that NBS has changed its methodology for calculating the unemployment rate,” Madu told Africa Check.
“The statistician-general will make an official announcement on this, most likely before the end of this month [June 2023] and new unemployment figures will be published based on the new method,” he said.
As a precursor to this, the bureau published its new framework for labour force statistics in April 2023. – Allwell Okpi
Following on the claim that “currently one in three Nigerians who want to work are unable to find a job”, the BBC said that before Buhari took office, the figure was “less than one in 10”.
Buhari became president in May 2015, after beating Goodluck Jonathan in an election earlier that year.
It is accurate that Nigeria’s unemployment rate was below 10% when Buhari took over from Jonathan.– Allwell Okpi
Another reason why Tinubu is under pressure to tackle the economic crisis, said the BBC, is that “output from the vital oil industry is shrinking”.
Crude oil still accounts for more than 75% of Nigeria’s exports, according to the national statistics office. Therefore, a decline in oil production would have a major impact on government revenues and, by extension, the country's economy.
The central bank publishes monthly crude oil production figures on its website. It currently covers the period January 2006 to March 2023. The figures are the monthly average of daily oil production.
In the 10 years from January 2006 to February 2016, Nigeria produced an average of over 2-million barrels of oil per day per month. Only three months were below this mark.
In the following four years, from March 2016 to March 2020, production figures ranged between 1.5- and 2.07-million barrels per day. The majority of the months were below 2-million barrels per day.
Nigeria last produced a monthly average of at least 2-million barrels per day in April 2020. Oil production then declined from there to a low of 940 000 barrels per day in September 2022.
Crude oil production slightly up in April 2023
Figures published by the Nigerian Upstream Petroleum Regulatory Commission match those published by the CBN. However, they include data for April 2023.
The commission’s data shows that crude oil production dropped to an average of 998 602 barrels a day in April 2023.
However, the monthly oil market report from the 13-member Organization of the Petroleum Exporting Countries (Opec), of which Nigeria is a member, showed the country produced 1.18-million barrels a day in April, down from 1.35-million barrels per day in March. This report was published on 11 May.
The Opec data also shows that average daily production in 2021 was 1.37-million barrels per day. It dropped to 1.2-million barrels a day in 2022.
When all this data is considered, it is mostly correct to say that the country’s output has nearly halved from its highs of 2006 to 2016. – Allwell Okpi
Another challenge for Tinubu are the “low revenues from declining oil sales”, said the BBC.
But this is unsupported by the most recent data.
NBS data shows that Nigeria’s oil sales fell from N15.16-trillion in 2018 to N14.69-trillion in 2019 and further to N9.44-trillion in 2020, before rising to N14.41-trillion in 2021.
The country's oil sales have increased after a decline in 2020 following the Covid-19 shutdowns. –Allwell Okpi
Buhari's critics often vilify him for borrowing heavily and significantly increasing the country's debt profile.
So when he wrote to the senate a few weeks before the end of his term, seeking approval to borrow $800-million from the World Bank to cushion the impact of removing the fuel subsidy, there were protests.
The lawmakers however granted Buhari’s request on the understanding that the funds would be used by the incoming administration.
Buhari's government made no provision for paying the subsidy beyond June 2023, one month after he had left office.
Loan approved by World Bank in December 2021 to alleviate removal of fuel subsidy
Amid the controversy, the World Bank clarified that the loan request was not new and that the decision to withdraw the facility would be taken by the new government.
The World Bank's country director, Shubham Chaudhuri, told This Day newspaper that Buhari getting the approval from lawmakers would only make it easier for the incoming government to access the fund if it commits to the removal of the fuel subsidy.
Chaudhuri said the bank’s board of directors approved the $800 million loan in December 2021, as an additional round of financing for the National Social Safety Net Programme. He said the institution has been financing the programme, starting with an initial $500-million in 2017.
The loan was intended to support those who would be most affected by the rise in prices following the removal of the subsidy.
Therefore, the claim that Buhari’s government rushed to secure the $800-million loan as he was about to leave office is misleading. – Allwell Okpi
In June 2023, the clock estimated that 67.5-million Nigerians were living in extreme poverty, measured as living below the World Bank’s poverty line of $1.90 a day. (Note: Read more about how it is measured here.)
A homegrown estimate
The Nigeria Living Standard Survey, released in May 2020, estimated that 82.9-million people were living in poverty. The survey, by the country’s statistics bureau, did not use the World Bank’s $1.90 poverty threshold.
The bureau said it had set the national poverty line at N137 430 a year or N376.5 a day. At the time, this was equivalent to $353 a year or $0.97 a day.
This has fallen to $297.5 a year or $0.81 a day at the official rate of N461.92 to the dollar as of 1 June 2023. – Oluseyi Awojulugbe
The BBC defined gross domestic product (GDP) per head as the economic output produced in a year by the average person.
GDP measures the total production of goods and services in a country over a period of time, usually one year.
Experts have previously told Africa Check that a decline in Nigeria’s GDP per capita over the years could be due to continued population growth amid economic downturns.
Nigeria’s GDP contracted in 2016 after the price of crude oil, its largest foreign exchange earner, fell. In 2020, the economy faced the twin threats of the Covid pandemic and low crude oil prices, and slipped into a recession.
In 2021, the World Bank estimated that Nigeria’s GDP per capita was $2 065, compared to $70 248 in the US and $46 510 in the UK.
But this comparison does not paint an accurate picture, Sheriffdeen Tella, a professor of economics at the Olabisi Onabanjo University in Ago-Iwoye, Ogun state in southwest Nigeria, told Africa Check.
“The UK and the US are developed economies, so it is not accurate to say that the productivity of the people in those countries is higher than that of people in Nigeria.
“For a fair and accurate analysis, Nigeria’s GDP per capita should be compared with countries that have a similar structure and are classified as developing countries, as Nigeria is,” Tella said. – Oluseyi Awojulugbe
Tinubu was the governor of Lagos state, Nigeria’s economic capital, from 1999 to 2007.
Internally generated revenue (IGR) refers to a state’s income. It does not include funds received from the federal government. Nigeria’s statistics office has only published IGR data since 2010.
In 2006, a news report quoted Ismail Adewusi, then Lagos state commissioner for finance, as saying the state’s internally generated revenue had increased from N600-million monthly in 1999 to N5.5-billion monthly in 2006. This is an increase of over 900%.
A journal article published in 2014 by researchers working with the National Institute for Legislative Studies in Nigeria’s national assembly estimated that the state’s annual IGR grew from N14.6-billion in 1999 to N83.02-billion in 2007.
Data from the Joint Tax Board, which comprises representatives from each state and other government agencies, estimates that Lagos generated N94.8-billion in 2007 (an average of N7.9-billion monthly). The board’s IGR data covers the period 2007 to 2021. – Oluseyi Awojulugbe
The BBC article did not specify whether it was Nigeria's total production in 2022 that fell to a 30-year low, or production figures for one day or one month in that year.
But the author told Africa Check that he looked at production figures for the months of August and September 2022.
Oil theft has been a problem in Nigeria and Mele Kyari, who heads the Nigerian National Petroleum Corporation Limited (NNPCL), said the level of theft had been unprecedented in recent years. Different groups have tried to estimate how much crude oil is stolen on a daily basis.
Gbenga Komolafe, the commission’s chief executive, said that of the 141-million barrels produced in the first quarter of 2022, only 132-million barrels of oil were received at export terminals – a shortfall of nine million barrels in three months. The NNPCL estimated that 700 000 barrels a day were lost.
On a monthly basis, figures published by the Central Bank of Nigeria show that the 972 394 barrels of crude oil (excluding condensates) pumped in August 2022 was the lowest since at least January 2006, when the bank began tracking oil production data.
The Debt Management Office is responsible for the management of domestic, external and subnational debt.
Data published on the agency’s website showed that the country's debt stood at N12-trillion at the end of March 2015, two months before Buhari took office.
Nigeria’s debt levels had increased to N46-trillion by December 2022, about $103.11-billion at N488.08/$. This is the latest data published by the debt office. – Oluseyi Awojulugbe
The BBC journalist told Africa Check that the data came from the World Bank.
In its April 2023 Macro Poverty Outlook for Nigeria, the bank said the country’s debt-service-to-revenue ratio increased from 83.2% in 2021 to 96.3% in 2022. This ratio measures a country’s ability to meet its debt obligations based on the revenue it generates.
The development lender also said that Nigeria's public debt stood at over 38% of GDP.
However, a public presentation of the country's 2023 budget by Zainab Ahmed, the then finance minister, showed that 80.6% of the federal government's revenue was spent on debt servicing between January and November 2022.
‘No money for basic needs’
Akpan Ekpo, a macroeconomics professor and former director of the West African Institute for Financial and Economic Management, previously told Africa Check that Nigeria’s debt-service-to-revenue ratio was unsustainable.
Economics professor Sheriffdeen Tella of Olabisi Onabanjo University agreed with Ekpo, saying the government must restructure its debt to get relief.
“A high debt-service-to-revenue ratio means that the government does not have enough money to meet the basic needs of the citizens,” Tella told Africa Check.
“The Nigerian government needs to restructure its debt to be able to free up some resources. It can ask for a moratorium on some of the loans to ease the pressure on the government’s pocket.” – Oluseyi Awojulugbe