Moderating soaring lending rates and approving the revised National Social Protection Policy among other decisions were taken by the National Economic Council (NEC) yesterday.
The Council considered government’s fiscal and monetary policy measures, particularly for priority sectors of the economy as part of efforts to accelerate growth, investment and job creation.
The revised social protection policy was designed to support accelerated and inclusive development.
The Council, chaired by Vice President Kashim Shettima, expressed concern that prevailing lending rates remained a major constraint to businesses and the real sector despite improvements in key macroeconomic indicators.
Minister of Finance and Coordinating Minister of the Economy, Dr. Taiwo Oyedele, dropped the hint while briefing State House reporters after the 160th meeting of NEC at the Presidential Villa, Abuja.
Oyedele said the Council extensively reviewed the state of the economy and agreed on the need to translate the gains from recent reforms and macroeconomic stability into stronger growth and improved living standards for Nigerians.
‘Council expressed concern about the high rates of interest, particularly for businesses, and directed that we look at fiscal and monetary policy measures to moderate these interest rates,’ the minister said.
According to him, agriculture, energy, manufacturing, mining and the digital economy were identified as priority sectors requiring greater attention to accelerate economic growth and tackle poverty and inequality.
He said the Council showed particular concern about the sectors employing the majority of Nigerians, noting that 81.4 per cent of the people work in agriculture and non-tradable services.
‘Council deliberated that there is a need for us to accelerate growth in these sectors where majority of our people work. That way, we lift them out of poverty and we close the inequality gap’, Oyedele said.
Translating gains to shared prosperity
Giving an assessment of the economy, the minister said Nigeria had achieved significant macroeconomic stability, but stressed that the next challenge was translating the gains into shared prosperity.
He said real Gross Domestic Product (GDP) growth stood at 3.89 per cent in the first quarter of 2026, compared with 3.13 per cent a year earlier, while growth for the full year was projected to exceed four per cent.
Headline inflation, according to him, declined to 15.43 per cent at the end of July from 24.94 per cent a year earlier, although food inflation remained elevated at 20.31 per cent, against 26.2 per cent in the corresponding period last year.
Oyedele said external reserves had risen to $51.96 billion, their highest level since January 2009 and 38 per cent higher year-on-year.
He added that the naira had appreciated by 13.5 per cent year-on-year by the end of the first half of 2026, with the exchange rate now below N1, 400 to the dollar and showing relative stability and appreciation.
The minister said net federation account revenues rose by 44 per cent, from N15.2 trillion in 2024 to N21.9 trillion in 2025, and were projected to increase by at least another 50 per cent in 2026.
He also reported that Nigeria’s trade surplus had nearly doubled from N17.7 trillion in 2025 to N34.7 trillion by the first quarter of this year.
Total public debt, Oyedele said, remained below 37 per cent of the GDP at N159.28 trillion, while the debt-service-to-revenue ratio had declined from nearly 100 per cent in 2022 to below 60 per cent in 2025.
The minister said the progress was increasingly being acknowledged internationally, pointing to upgrades of Nigeria’s sovereign credit ratings by Fitch, Moody’s and SandP between April 2025 and May 2026.
‘All three major rating agencies – Fitch, Moody’s and SandP – upgraded Nigeria’s sovereign credit rating between April 2025 and May 2026, the first coordinated alignment in over a decade. So they all agreed’, he said.
Oyedele also cited Nigeria’s exit from the Financial Action Task Force grey list in October 2025 and the European Union’s Anti-Money Laundering and Countering Financing of Terrorism deficiency list in January 2026.
He said the developments were ‘lowering the cost and friction of cross-border capital and flows for Nigeria’.
The sovereign spread between United States Treasury bonds and Nigeria’s Eurobonds, he added, had narrowed to a historic low of less than 200 basis points, while the Nigerian capital market had emerged among the world’s best performers, with market capitalisation almost doubling within one year.
FTSE upgrades Nigeria
Oyedele described the recent decision by FTSE Russell to reclassify Nigeria from unclassified status to frontier market status as another significant development capable of opening the country to a broader pool of international institutional capital.
‘FTSE Russell just announced the reclassification of Nigeria from unclassified to the classification of a frontier market. This is good news for us as a country,’ he said.
On the implications of the decision, Oyedele explained that global investment classifications were particularly important to institutional investors, many of whom were restricted from investing in countries outside specified categories.
He said: ‘So, when FTSE Russell says they’ve now reclassified Nigeria to frontier markets, that automatically makes us eligible for investment. Or put differently, we become investable to many institutional investors globally,’ he said.
The minister said the Nigerian capital market had returned more than 60 per cent in dollar terms over the past year, even before the FTSE Russell reclassification.
He acknowledged that the market had undergone some correction in recent weeks, describing it as normal, but said the underlying trajectory remained positive.
Oyedele said: ‘So, you can then imagine, with all the macros we’ve analysed, and all these listings we are getting, getting on the right list and getting off the wrong list just means better days ahead.
‘We expect more inflows of not just foreign portfolio investment, which is short term, but we also expect the inflow of foreign direct investment in the coming days.
‘I think it’s an exciting time for all of us, and more reason why we have to stay the course of reform, and translate this as quickly as possible to micro outcomes for our people.’
The minister, however, said NEC recognised that significant risks remained and identified geopolitical conflicts, commodity shocks, persistent food inflation, election-cycle fiscal pressures and foreign exchange vulnerability to possible portfolio flow reversals among challenges requiring careful management.
Moderation of lending rate
The minister said the Council also discussed the need to ensure job-rich growth and develop strategies to moderate lending rates to the real sector.
Oyedele stressed that NEC was particularly concerned about maintaining the consistency of economic reforms and preventing the political cycle from undermining progress already recorded.
‘There is need for a particular focus on staying the course of reform to avoid reversals. The gains on inflation, reserves, the exchange rate, and our credit ratings are the direct result of sustained consistent policy. They are reversible if we waver’, he warned.
According to him, governments at all levels agreed that Nigeria could not afford reform fatigue, populist reversals or fiscal slippages as political activities ahead of the 2027 general election gather momentum.
He said NEC also agreed on the need to sustain policy consistency and deepen complementary reforms at the subnational level, particularly in agriculture and land administration, while strengthening support for vulnerable Nigerians.
States were urged to prioritise rural roads, storage facilities, transport links and security investments around farming belts to improve agricultural productivity and food security.
The Council also supported a Jobs and Productivity Compact aimed at channeling private capital into agriculture, agro-processing, housing, logistics and light manufacturing, while strengthening state-level tracking of inflation drivers, project implementation and welfare outcomes.
Oyedele said the Council reaffirmed that economic management and prosperity required shared responsibility across the three tiers of government.
‘Overall, council deliberated and agreed that our federation is that of shared responsibility, where the centre drives economic stability, but shared prosperity happens in the states, and better living standard must be delivered at the local level,’ he said.
More work needed
Akwa Ibom State Governor Umo Eno, noted that the balances in key federation accounts as of Wednesday.
Eno put the Excess Crude Account balance at $535,823, the Stabilisation Account at N90, 950,700,556 and the Natural Resources Account at N256,403,837,937.
The governor said the figures presented by the Finance Minister showed an improvement over the corresponding period last year and reinforced NEC’s assessment that the economy was stabilising, although more work remained to be done.
Borno State Governor Babagana Zulum said NEC also considered a presentation by the Minister of Industry, Trade and Investment on the forthcoming Creative Africa Nexus Weekend, CANEX WKND 2026, and the Intra-African Trade Fair scheduled for Lagos in November.
Improved police training critical
Ondo State Governor Lucky Aiyedatiwa, said NEC also received an update on the rehabilitation of 13 police training institutions across the country.
According to him, contracts had been awarded for the rehabilitation work, with about 80 per cent of contractors already receiving their award letters.
He said the rehabilitation was expected to be completed within three weeks to prepare the institutions for the commencement of police training programmes, while efforts were being intensified to secure the release of funds for the contractors to mobilise to site.
Aiyedatiwa said the Council considered improved police training critical to the fight against insecurity, irrespective of ongoing considerations around state policing.
He said minimum training standards must be maintained across the police system, requiring adequate infrastructure and equipment in the training institutions.
Enugu State Deputy Governor Ifeanyi Ossai said the Finance minister is committed to releasing the outstanding funds required to pay the contractors by next week.
He said NEC expected the contractors to deliver promptly, stressing that the intervention would not end with the immediate rehabilitation of the institutions but would be followed by sustained training and retraining of police personnel.
Ossai also called for greater public cooperation with the police, particularly through information sharing and collaboration, arguing that improved policing required support from citizens as well as better-trained personnel.
New social protection policy
Budget and Economic Planning Minister Atiku Bagudu said NEC considered and approved a revised National Social Protection Policy designed to support accelerated and inclusive development.
Bagudu recalled that Nigeria’s first National Social Protection Policy was adopted in 2017, leading to several programmes initially domiciled in the Office of the Vice President before they were transferred in 2019 to the Ministry of Humanitarian Affairs.
He said economic changes since then, alongside the objectives of the 2026-2030 National Development Plan to build a $1 trillion economy while ensuring inclusion, had made a review of the policy necessary.
According to him, NEC emphasised that social protection was a constitutional responsibility shared by the federal, state and local governments and consequently required cooperation among all three tiers.
The Council approved an assessment of existing social protection interventions to enable them to be better calibrated, coordinated and expanded in collaboration with states and local governments.
Bagudu said the policy would complement the Renewed Hope Ward Development Plan, under which the country’s 8,809 wards had been mapped to identify their economic and social opportunities and challenges.
He explained that the initiative was designed to take prosperity to every ward through a whole-of-society approach involving the three tiers of government, development partners, the private sector and non-governmental organisations.
NEC also approved the reconstitution of the National Social Protection Council, to be chaired by Vice President Shettima, with six governors and relevant federal ministers as members.