By Bankole Orimisan
The Federal Government’s renewed push to encourage the sale or concession of underperforming state assets to private investors has reopened an old but unresolved debate in Nigeria: should public assets remain in government hands despite inefficiency, or be transferred to private operators in the hope of unlocking value?
At the heart of the proposal is a familiar argument. Many state-owned enterprises — from moribund factories and transport companies to hotels, agricultural schemes and power assets — have become fiscal burdens. They gulp subventions, generate little revenue, and often serve as patronage platforms rather than productive ventures. With subnational governments grappling with rising debt, salary backlogs and infrastructure deficits, the idea of asset rationalisation appears economically sensible.
Yet, in Nigeria, privatisation is never just about economics; it is about trust.
The case for asset sales
Proponents argue that state asset sales could ease fiscal pressure, reduce waste, and attract fresh capital. If transparently executed, concessions or outright sales could stimulate productivity, create jobs, and improve service delivery. Nigeria’s experience in telecoms liberalisation is often cited as proof that private-sector participation can transform dormant sectors.
Economically, the potential implications are significant. Proceeds from asset sales could strengthen state balance sheets, reduce borrowing, and fund critical infrastructure such as roads, schools and healthcare. In a period of constrained oil revenues and mounting social demands, unlocking dormant capital could improve macroeconomic stability.
Moreover, credible reform signals could boost investor confidence at a time when Nigeria is competing for scarce global capital. Structured correctly, public-private partnerships (PPPs) could deepen capital markets and promote local enterprise participation.
The public scepticism
But Nigerians’ reactions are mixed — and cautious.
“I just hope it will not be another case where public property ends up in the hands of politicians’ friends,” says Chidinma Eze, a small business owner in Lagos. “We have seen this before.”
Her sentiment echoes a broader concern: past privatisation exercises have been criticised for opacity, asset undervaluation and elite capture. For many citizens, privatisation has sometimes translated into job losses, tariff increases and limited accountability.
Labour unions are particularly wary. Workers fear that efficiency gains under private ownership could come at the expense of employment security. In a country already battling high youth unemployment and inflationary pressures, any reform perceived as worsening livelihoods could provoke social resistance.
Reuben Abati’s caution
Public affairs analyst and former presidential spokesperson, Dr. Reuben Abati, has consistently urged caution in privatisation discourse. His position — frequently articulated in public commentary — stresses that asset sales must not become a hurried fiscal shortcut. According to Abati, privatisation without institutional reform merely transfers inefficiency from the public to the private sphere.
He has argued that transparency, valuation integrity and broad stakeholder engagement are non-negotiable. In his view, reform must prioritise public interest, not merely fiscal convenience. Without strong regulatory frameworks, asset sales risk entrenching monopolies or empowering politically connected investors at the expense of competition.
Abati’s broader concern reflects a governance dilemma: privatisation is not inherently good or bad; its outcome depends on process and oversight.
The economic implications
If well executed, state asset sales could:
Improve fiscal sustainability at subnational levels
Reduce recurrent expenditure burdens
Attract domestic and foreign direct investment
Enhance operational efficiency in key sectors
Expand tax bases through profitable enterprises
However, poorly structured transactions could:
Deepen inequality through asset concentration
Trigger labour unrest
Undermine public trust in economic reform
Create private monopolies with weak regulation
Sacrifice long-term strategic value for short-term revenue
The broader macroeconomic implication lies in credibility. Nigeria’s reform trajectory since fuel subsidy removal and exchange rate unification has been anchored on difficult but necessary structural adjustments. Asset rationalisation could complement these reforms — but only if handled transparently and inclusively.
Reform beyond revenue
Ultimately, asset sales should not be treated as a one-off revenue-raising tool. They must form part of a comprehensive economic strategy that includes governance reform, regulatory strengthening, anti-corruption safeguards and social protection measures.
Nigerians are not opposed to reform; they are opposed to exclusion.
The success of this initiative will depend less on the economic logic — which is compelling — and more on political will, transparency and fairness. If citizens perceive the process as equitable and beneficial to collective welfare, it could mark a turning point in subnational economic management.
If not, it risks becoming another chapter in Nigeria’s long history of contested privatisations.
The choice before the Federal Government and state authorities is therefore clear: reform with credibility, or repeat the mistakes of the past.
Article written by Bankole Orimisan, a journalist based in Lagos
