As Bola Tinubu of the ruling All Progressives Congress (APC) prepares to take office on 29 May following his victory at the 25 February presidential election, we examine the likely policy direction of the new administration and the prospects for improvements in the business environment.

  • Despite ongoing legal challenges, the courts are likely to confirm Tinubu’s victory in the coming months and the decision is unlikely to disrupt the transition process.
  • With the APC remaining in power, overall continuity in governance is likely, though Tinubu is likely to appoint new individuals to key government positions, such as central bank governor. 
  • Tinubu is likely to prioritise addressing longstanding challenges posed by widespread insecurity, food supply and energy shortfalls, and high inflation, though resource constraints and opposition from vested interests will hamper progress.
  • The business environment will remain challenging in the coming years sustaining widespread operational challenges for businesses, notably in access to power.


What next?

The APC will remain politically dominant, having secured a majority in the Senate (upper house) and the largest number of seats in the House of Representatives (lower house). Although it now appears to have fallen only a few seats short of an outright majority in the lower house the party also secured majority of the gubernatorial positions available in elections on 18 March, winning in 15 states. 

The opposition Labour Party (LP) and People’s Democratic Party (PDP) have challenged Tinubu’s victory. The legal process is likely to be prolonged, with the courts having up to 240 days to rule on election petitions, meaning a judgment could come as late as October. Nonetheless, there is no precedent for the courts to overturn the results of a presidential election and we expect the courts to confirm Tinubu’s victory. The ongoing legal challenges are unlikely to disrupt the transition, with Tinubu likely to take office on schedule at the end of May.

Old faces in new roles 

Tinubu’s immediate focus will be on appointing his cabinet, with a bill signed by President Muhammadu Buhari on 17 March requiring him to form a cabinet within 60 days of taking office. Tinubu is likely to appoint APC-linked individuals to his cabinet and key government positions, both providing some continuity in governance and reducing the likelihood of any significant shifts in policy direction. 

Businesses will take a keen interest in Tinubu’s appointments to key roles. Although unconfirmed, former Lagos state commissioner for finance Wale Edun could be appointed central bank governor or minister of finance, given his experience in the banking sector. Former Kaduna state governor Nasir El-Rufai has reportedly been considered either as secretary to the federal government, where he would supervise numerous security agencies, or as minister of the FCT. 

Dele Alake, the former commissioner for information and strategy in Lagos state during Tinubu’s stint as governor (1999-2007) could also become minister of the FCT. Minister of State for Labour and Employment (2019-) Festus Keyamo could take on the humanitarian affairs, disaster management and social development portfolio or become presidential spokesperson. Although he has not been tipped as a potential minister, Tinubu’s cousin Adewale Tinubu, the CEO of local company Oando, is likely to become an influential actor in the oil and gas sector.

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Consensus governance

With the APC likely to only need a handful of votes from other parties to pass legislation in the lower house, it is likely to make periodic concessions to ensure it passes major legislation. However, low voter turnout and overall support for Tinubu at the election – he received 8.8m votes compared with 15.2m for Buhari in 2019 – highlights widespread frustration, particularly among younger voters. This will mean that Tinubu has to tread carefully with proposed reforms, particularly any that could worsen cost-of-living pressures. 

The campaign was divisive, with younger voters largely perceiving Tinubu as part of an older, out-of-touch elite that has failed to respond to their grievances, which range from their limited political representation to growing socioeconomic challenges. The economically influential Igbo community, which represents approximately 15% of the population, campaigned strongly for an Igbo president and will likely continue to feel marginalised from the highest levels of power, particularly following reported attacks on individuals perceived as being Igbo during the elections. This will continue to fuel pro-separatist sentiment in the south-east region, where the Igbo are the most populous community.

In addition, the APC’s decision to field Muslim presidential and vice-presidential candidates also drove widespread criticism from Christian groups, and is likely to drive perceptions of exclusion in Nigeria’s majority-Christian south. Many of these grievances are deep-rooted and will persist in the coming years, driving communal violence and political tensions across the country.  

Ambitious plans delayed

The APC’s campaign manifesto largely reflects the priorities of the Buhari administration – notably growing the economy, tackling insecurity and investing in infrastructure. However, it also proposes several ambitious policies that – if implemented – would be likely to drive significant improvements for businesses and in the operating environment. These include reforming the exchange rate regime, improving domestic refining capacity to help to address fuel shortages, and tackling insecurity through both military and socioeconomic approaches.

However, the new administration is likely to be waylaid by tackling more immediate challenges such as revenue shortfalls, growing debt sustainability concerns and widespread insecurity. Addressing these is likely to distract the administration from planned reforms. Popular opposition to some of these changes, such as increasing electricity prices, is also likely to force the government to proceed gradually. 


The manifesto outlines several approaches to boost economic growth. These include incentivising investment in the agriculture and manufacturing sectors through tax credits or rebates, investing in infrastructure development, encouraging the development of new industries (for example, technology, entertainment, tourism) and reinvigorating the oil and gas sector. These mirror many of the outgoing administration’s priorities – notably discouraging non-essential imports while seeking to improve tax collection and drive investment in the agriculture, manufacturing and oil and gas sectors. As such, many of the existing challenges that have stalled growth in these sectors, in particular regulatory uncertainty and widespread insecurity, are likely to continue to undermine progress. 

Although Tinubu has announced that his administration will end the fuel subsidy and reform electricity tariffs to allow distribution companies to charge cost-reflective tariffs, these measures are likely to face widespread opposition. The Buhari administration had postponed the removal of the petrol (gasoline) subsidy amid public and union pushback. However, Tinubu in his inauguration speech pledged to end the petrol subsidy and petrol prices more than doubled nationwide following his speech. Although trade unions have opposed the measure the government is likely to maintain higher prices given the cost of extending the subsidy, which is set to expire on 30 June. 

Amid growing concerns over Nigeria’s debt sustainability, the manifesto pledged to limit exposure to debt denominated in forex. However, the new administration will likely continue to grapple with debt challenges amid persistent revenue shortfalls. This will sustain elevated sovereign risks, particularly for state-level administrations, the vast majority of which remain reliant on allocations from the federal government. 


Tinubu’s government will continue to explore new methods of raising revenues. These efforts are likely to focus primarily on businesses to avoid exacerbating public frustration with rising cost of living challenges. Measures are likely to involve taxes on lucrative sectors or areas hitherto not subject to significant tax demands, such as the tech sector, and efforts to formalise smaller businesses. 

In this context, operators are likely to be exposed to growing scrutiny of their tax and regulatory compliance as the government seeks to boost revenues. They will also face continued regulatory uncertainty stemming from the potential for the government to announce new taxes and other regulations at short notice. Ongoing foreign exchange shortages and high levels of inflation will continue to drive rises in the cost of doing business. 


Tinubu’s manifesto proposes a two-fold approach to tackling insecurity, a major public concern. It emphases improving equipment and training for the armed forces and establishing community policing at local levels. It also proposes strategies to tackle the root causes of conflict, such as rehabilitating the Lake Chad basin ecosystem and other economic systems affected by conflict, and re-establishing fisheries and other profitable aquaculture activities in the Niger Delta region. Nonetheless, given significant resource constraints security forces are likely to maintain their military-driven responses to insecurity, with periodic successes. 

In this context, insecurity will continue to drive challenges to project sites, personnel and supply chains. Businesses will continue to face direct security threats from crime across the country, while insecurity will continue to impact the operating environment. For example, operators in the south-east will face regular disruption from separatist stay-at-home orders. Meanwhile the activities of bandit and Islamist militant groups will disrupt movement of personnel and goods in the north-west and north-east and pose threats to project sites in these regions. 

Ongoing socioeconomic frustrations will likely lead to periodic outbreaks of unrest, which can cause significant disruption to movement and incidental security threats. They will also sustain demands on operators across the country to provide employment opportunities for or use services from local communities. These can escalate to blockades of project sites or violence if expectations are not managed. 


Source: Independent National Electoral Commission 

Energy and infrastructure 

Tinubu’s manifesto calls for greater investment in infrastructure, notably in the energy sector, aiming to generate 15,000 MW of power in the next four years, almost quadrupling the current delivery of 4,000 MW, far below its potential 12,500 MW capacity. It mirrors the current government’s emphasis on extracting value from the oil and gas sector. Notably, it aims to increase oil production to an optimistic 2.6m barrels per day (bpd) by 2027 and 4m bpd by 2030 by strengthening pipeline security, providing incentives for new participation in the sector and improving indigenous participation. The manifesto also proposes reforms to the downstream sector, where investment has been hampered by foreign exchange restrictions and price controls, leading to periodic petrol shortages, by deregulating the sector and increasing domestic refining capacity.  

However, resource constraints are likely to continue to undermine investment in infrastructure. Operators will continue to face infrastructure shortfalls across the country, particularly in remote areas. Although some improvement in power generation is likely in the coming years, this is likely to proceed slowly and have a limited impact on the operating environment, leaving businesses largely reliant on private generators for power. While the construction of the Dangote refinery – a 650,000 bpd refinery in Lagos inaugurated by Buhari on 22 May -will address some of the drivers of petrol shortages in recent months, the planned removal of the petrol subsidy will increase operational costs for businesses. . Ongoing infrastructure and energy shortages will remain among the primary challenges for businesses.


The business environment is therefore likely to remain challenging under Tinubu, though some economic reforms are likely to be implemented and some progress made in addressing existing challenges. Operators will therefore continue to face many of the challenges that have characterised the Buhari administration. Meanwhile, although the political environment is likely to remain broadly stable, likely changes to some government officials will alter the stakeholder landscape, forcing businesses to build relationships with new stakeholders.  

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