Richer State, Poorer Citizens: Tinubu’s Fuel-Subsidy Removal, Revenue Windfall, And The Dialectics Of Inclusive Development In Nigeria

• John Moses Maikomo

  Department of Political Science and International Relations, Taraba State University, Jalingo, Taraba State

  Author

• Jessey Dearsley Dabale

  Department of Political Science and International Relations, Taraba State University, Jalingo, Taraba State

  Author

• Auta James Bawa

  Department of Political Science and International Relations, Taraba State University, Jalingo, Taraba State

  Author

• Hero Bitrus Bravo

  Department of Political Science and International Relations, Taraba State University, Jalingo, Taraba State

  Author

The removal of Nigeria’s decades-old fuel subsidy by President Bola Ahmed Tinubu in May 2023 produced one of the most significant fiscal and socioeconomic shifts in the country’s contemporary history. This study interrogates the emerging paradox whereby the Nigerian state becomes fiscally richer following the elimination of subsidy payments, even as citizens become materially poorer. Anchored on Rentier State Theory and a political-economy analytical framework, the study employs a qualitative-descriptive design supported by secondary data from FAAC, the NBS, BudgIT, the World Bank, and IMF (2023–2025). Findings show that while subsidy removal created an unprecedented fiscal windfall of over ₦7.5 trillion and expanded FAAC allocations by more than 130 percent, these gains did not translate into improved living conditions or inclusive development. Instead, fuel-price deregulation and exchange-rate unification triggered inflation above 30 percent, food inflation exceeding 40 percent, rapid currency depreciation, sharp erosion of real wages, and the addition of millions to the poverty population. The study reveals that weak institutions, opaque fiscal management, and elite capture hindered the redistribution of subsidy savings, thereby reinforcing the structural vulnerabilities associated with rentier governance. Comparative evidence from global subsidy-reform experiences further illustrates that reforms implemented without robust social safety nets and credible governance mechanisms often deepen inequality rather than stimulate development. The study concludes that fuel-subsidy removal in Nigeria has so far amplified the “richer state, poorer citizens” paradox and argues that without institutional strengthening, transparent revenue governance, and targeted social protection, the long-term developmental gains of subsidy liberalization will remain elusive. The study recommends the institutionalization of a transparent social protection and targeted cash-transfer framework alongside robust macroeconomic stabilization and strengthened regulatory institutions to cushion vulnerable groups, curb inflationary pressures, enhance policy credibility, and ensure that fuel subsidy reforms translate into sustainable development outcomes. 

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