IMF and World Bank Misjudge Nigeria's Poverty Situation

How can the increased funds at state and local government levels and the push to empower local governments not be counted as progress in reducing poverty in Nigeria? How can reports from the IMF and World Bank about more capital spending at the local level not affect the Multidimensional Poverty measure that reflects how much infrastructure is built close to the people? Why do the IMF and World Bank judge Nigeria based on a 2022 Multidimensional Poverty Report when our states have been building more infrastructure since then?

Since I posted about how many states owed salaries to civil servants for up to a year, social media has been filled with anger. Some states owed salaries for 18 months under the PDP governments of Presidents Jonathan, Yar’Adua, and Buhari. I often wondered how people survived without salaries for even two months. These were incomes that could not even take them home. Yet, civil servants in Nigeria went for months without pay. My post received a lot of backlash, with insults and curses from social media users. Nigeria has many social media warriors who can say the worst things online, but often hide behind screens in real life. Despite the negativity, I still believe that people are good, even if the harsh realities in Nigeria can make one think otherwise.

Thanks to Artificial Intelligence, research is now easier. I used Gemini AI to find out how many states owed salaries in 2014. It revealed that the Nigeria Labour Congress reported 22 states owed salaries for up to six months in 2014, just before Jonathan left office. I have nothing against President Jonathan; he led during a time when Nigeria was financially fortunate due to high crude oil prices. Many also credit the best economic management of that time to Professor Okonjo-Iweala, who was the coordinating minister for the Economy. I checked back to 2011, and AI gave the same results. Salaries were owed for many months. Pensioners protested on the streets. Thankfully, that is not the case today.

Some reasonable commenters on my Facebook page offered excuses. They pointed out the value of money, with the naira trading between ₦250 and ₦400 at that time. Others questioned the price of fertilizers and cement. But I wondered how we could compare values when people received zero pay. Many states during that time paid half salaries for years. When a person does not receive their salary for months or even a year, there is no value to compare. Zero pay means zero value. Despite this, Nigerians survived that period, and many have forgotten it. Even if we have forgotten, does it mean we should react violently when reminded? This is the toxic politics in Nigeria. Some claim they want democracy, yet they engage in the worst behavior.

I believe this truth should be shared more by those who care about democracy and support Tinubu's administration. It seems we suffer from mass amnesia, and some people are taking advantage of this. How could we forget? For those who argue that not everyone is a civil servant, that is valid. But the inability of federal, state, and local governments to pay civil servants affects everyone. The private sector quickly follows suit. People complain about the economy. Even now, although we do not have such practices due to Tinubunomics, some in the private sector have raised their prices significantly while blaming the bad economy for not treating their employees fairly. This is a troubling trend I have tried to fight against. Many CEOs enjoy luxury while their staff suffer, often paying poorly or withholding salaries to keep them anxious.

When governments stop paying civil servants, it invites more corruption and crime. Some policemen have even been known to lend their weapons to criminals for money. I believe that the tough reforms under President Tinubu have led to positive changes. More funds are now available to state and local governments as it should be in a growing presidential system. Everyone lives in a state or local government; nobody lives in the federal government. Even the Federal Capital Territory has its own governor. A policy that shifts more money to local governments also places more responsibility on them for improving people's lives. This makes sense. Our states are responding as shown by World Bank and IMF data indicating significant capital spending at the local level, surpassing federal spending. I just returned from Ekiti State, where I saw major improvements. A new bridge opened in Ado-Ekiti, and a new road now connects Ado-Iworoko with the Airport at Ijan Ekiti. The governor told me that access roads into Ekiti from Ilawe and Akure have been fixed. Some of these projects were federal, but Governor Oyebanji often takes the initiative and sorts it out later.

As I write this article to remind everyone of the serious issues we faced just a few years ago, specifically, paying salaries owed to struggling civil servants, which spilled over to other public and private sector workers, I was disappointed by the latest IMF Report on Nigeria that said poverty has increased. The report did not provide detailed research to back up how it reached this conclusion. It feels like we are back in 2007/8 when flawed algorithms misled global financial markets. Is it possible that the IMF and the World Bank, two major global organizations, have fallen into a bias against Nigeria that leads them to conclude poverty always increases here? This needs investigation.

The IMF has backed every government action but contradicted its own findings. The IMF praised the Tinubu government for its reforms. Tinubu was right about the Naira, the subsidy removal, and the tight monetary policy under Mr. Yemi Cardoso. The IMF, like the World Bank before it, urged that Tinubu stay the course because the reforms are working. I believe these reforms are laying a strong foundation for our economy. Yet, the IMF missed two crucial points in its criticism of Nigeria’s reforms: the support of Nigerians. The report focused on the claim that 63 percent of Nigerians are in poverty. I do not believe that claim for several reasons. But most people ignore anything beyond that poverty statement. There should be a better way to communicate these issues. You cannot support a program and then undermine it at every turn. This could lead to waste in our spending. The people's support and understanding are priceless.

How can the increase in funds at state and local levels and the empowerment of local governments not show progress in reducing poverty? How can the IMF and World Bank reports of increased local capital spending not affect the Multidimensional Poverty measure, which reflects local infrastructure? How can the IMF and World Bank judge Nigeria using the 2022 Multidimensional Poverty Report when our states have constructed more infrastructure since then? The Okeyinmi-Ajilosun Bridge I saw opened in Ado-Ekiti and the new Ekiti Knowledge Zone at Ijan Ekiti are part of the infrastructure that reduces Multidimensional Poverty. The Chief Fasoranti Bridge in Akure also helps ease traffic for thousands. Across Nigeria, we see improvements in infrastructure, including roads, schools, and over 4,000 Primary Healthcare Centres. Why do these projects not appear in the data about Nigeria? Is it easier and more appealing to claim everything is falling apart in Nigeria? This is not fair, and I must challenge this narrative. How does the fact that the government has cleared all salary arrears for workers nationwide through policies praised by the IMF and World Bank not matter, and only lead to more poverty? How does the drop in inflation, especially food prices in 2025, not factor into the poverty analysis by multilateral agencies? Why is the consistent bumper harvest in 2023, 2024, and 2025 not reflected in decreased poverty? Even the Naira gaining value against the Dollar since 2024 is overlooked. Why are we not calling for a new Multidimensional Poverty Report since 2022 that accounts for all the local infrastructure our governors have completed, including federal projects under President Tinubu? I call for a review of our powerful international lenders. Their actions have harmed us too often.

The IMF has also urged caution about the $5 billion swap deal Nigeria is negotiating with First Abu Dhabi Bank. Instead, they suggested Nigeria should fill funding gaps with costly Eurobonds. They also recommended prioritizing cash transfers to the people. I disagree with this, not because people cannot use cash, but because of the many traps involved. I believe Nigeria should direct such funds into agriculture to boost food production. We should replicate what the Americans did by providing food stamps, now called the SNAP program, instead of just injecting cash into the system, which can lead to unproductive inflation.

I have warned in the media that we should not use Nigeria's poverty issues as a weapon, worsening the situation rather than solving it. Many who discuss poverty are not genuinely interested in fixing it. In fact, if the problem disappears, many will lose their platforms and have nothing to talk about. They thrive on keeping the issue alive, using it to depress Nigerians and twist the knife in their wounds. I have pointed out many behaviors that make me question the rising poverty narrative. I also looked at these issues from the angle of inequality and informality. I urge those who truly want to solve this problem to consider other possibilities because economic issues cannot be solved with a one-track mind.

In conclusion, I want to highlight the data issue. Data is vital for a nation’s success. All levels of government and the private sector must take data seriously. When we talk about data, we mean more than just numbers. Data includes any information that can be collected and stored, numbers, images, words, and social media interactions. Having a data mindset means understanding how to document and store information. Countries that excel today know this and sell valuable information after processing their data. This is why relying on external data can be dangerous. Funding data gathering, storage, and analysis is a priority for all levels of government in this age of Big Data and AI. Countries like India have shown what can be done with a strong data policy. India is now the world’s fourth largest economy and has made significant strides in poverty reduction. I saw India’s turning point, and it relies on smart strategies and data management. China also protects its data fiercely, releasing only what serves its interests.