Despite the global economic downturn, the World Bank’s latest Global Economic Prospects report for 2025 still projects an economic growth rate of 3.6% for Nigeria. This projection is presented at a time when global growth is projected to decrease only to 2.3%, underscoring Nigeria’s status as one of the more resilient economies in sub-Saharan Africa.
Despite inflation, exchange rate fluctuations and security risks, Nigeria’s economy seems to be holding steady. The World Bank reports that the country’s performance in recent quarters, particularly in Q4 2024 where GDP surged by 4.6% year-on-year is indicative of stronger-than-expected recovery. Despite the short-term effects of structural reforms like fuel subsidy elimination, FX liberalization, and increased revenue mobilization, growth has been driven by these measures which had both short-term shocks and long-term benefits.
Non-oil industries in Nigeria have surpassed traditional petroleum revenue sources, with the rise of information and communications technology (ICT) and financial services. The shift is essential in shielding the economy from the fluctuating oil prices worldwide. Despite ongoing issues with oil production due to theft, vandalism, and infrastructure damage, the diversification campaign is appearing to be on the rise.
Inflation remains a key challenge. Although still high, inflation is expected to fall to about 22% by the end of 2025, down from more than 30% earlier in the year. There has been a disinflation trend due to tighter monetary policy from the Central Bank of Nigeria (CBN), better agricultural output, and stability of exchange rates. Enhanced revenue collection and expenditure discipline have led to a reduction in the fiscal deficit, which was 5.4% of GDP in 2023 but decreased slightly around 3% by 2024.
It is worth mentioning that the World Bank’s forecast differs slightly from that of the International Monetary Fund (IMF), which pegs Nigeria’s 2025 growth at 3.0%. The divergence is mainly due to differing assumptions on policy implementation, oil production, and global demand patterns. However, both institutions recognize that Nigeria’s ongoing reform could lead to long-term growth if it is sustained.
Nevertheless, risks persist. A combination of global trade tensions, lower commodity prices, and domestic policy reversals may result in Nigeria’s growth outlook being hampered, according to the World Bank. Uncertainty surrounding 2027 general elections, along with public opposition to the removal of subsidies and tax hikes, could hinder reform progress.
While macroeconomic indicators have improved, per capita income remains below pre-pandemic levels, as reported by the World Bank in its latest Nigeria Development Update. Poverty and inequality are still deeply rooted, and GDP growth, while positive, has not been sufficiently inclusive or fast enough to lift the poverty burden of millions in Nigeria. For achieving broad-based development, the Bank proposes that investments in education, healthcare and infrastructure should be targeted while improvements to the business environment must be made to ensure greater financial inclusion.
The World Bank projects a gradual acceleration in growth through 2026 and 2027, forecasting GDP expansion of 3.7% and 3.8% respectively. The success of these figures will depend on Nigeria’s ability to maintain policy consistency, invest in human capital, and strengthen institutional capacity. In case of success, the country may attain a trillion-dollar economy before 2030. Despite the volatility and uncertainty of global markets, Nigeria’s steady forecast provides a rare moment of stability. Nigeria can achieve sustainable and inclusive growth through the use of appropriate policies and commitment, which is a significant message for investors, policymakers, and development partners
