Poverty, wealth concentration bigger problems than subsidy — Experts

•Insist subsidy policies should serve citizens, rather than narrow interests

Nigeria’s economic debate is shifting away from fuel subsidies, with economists and development experts warning that poverty and extreme wealth concentration pose deeper threats to growth and stability.

They argue that while subsidy reforms have dominated policy discussions, the widening gap between a small wealthy elite and millions struggling for basic needs is what is actually holding back progress.

Bongo Adi, a distinguished Professor of Economics at Lagos Business School, Pan-Atlantic University, said Nigeria, as a developmental state, should adopt problem-driven iterative adaptation in policy formulation, rather than rigid one-track positions.

He explained that countries oriented towards developmentalism change course when evidence demands it, re-evaluating policies to deliver the greatest good for the largest number of people.

Adi identified high poverty and inequality as the core issues. “Nigeria has reappeared as the poverty capital of the world. So when you have 165 million living below the poverty line, that is really a cause for concern,” he said. Linked to this is extreme wealth concentration.

Drawing on Thomas Piketty’s ‘Capital in the 21st Century’, Adi noted that when the rate of return on capital exceeds the rate of economic growth, wealth concentrates further in few hands. This leads to underutilisation of assets, such as high vacancy rates in properties built not for occupation but as stores of value.

He observed that during earlier periods of high growth averaging seven percent for a decade and foreign reserves around $67 billion, subsidy was not a major problem and poverty was lower. Current macroeconomic stabilisation, with reserves rising toward $55 billion, is positive, yet the…