IMF Boosts Nigeria’s 2025 Economic Growth Forecast to 3.4%, Signalling Reform Success.
The International Monetary Fund (IMF) has raised its economic growth projection for Nigeria to 3.4% for 2025, a 0.4 percentage point increase from its April forecast of 3.0%. Announced in the July 2025 World Economic Outlook (WEO) update, the upward revision reflects growing confidence in Nigeria’s ongoing economic reforms and improved global conditions. The IMF also upgraded its 2026 forecast for Nigeria to 3.2%, up 0.5 points from 2.7%, highlighting a sustained positive trajectory.
The report attributes Nigeria’s improved outlook to robust oil production, a thriving services sector, and the federal government’s bold reforms under President Bola Tinubu’s administration. Key measures, including the removal of fuel subsidies, naira devaluation, and enhanced revenue administration, have bolstered macroeconomic stability and attracted portfolio inflows, with Nigeria successfully tapping the Eurobond market in 2024. Tunde Abidoye, Head of Equity Research at FBNQuest Merchant Bank, noted that the 3.4% forecast aligns with domestic data, crediting “improved oil output and strong services performance” but cautioned that growth remains modest to address poverty challenges.
Globally, the IMF revised its 2025 growth forecast to 3.0%, up 0.2 points, driven by lower tariffs, better financial conditions, and front-loaded trade activity. Sub-Saharan Africa’s outlook was also upgraded to 4.0% for 2025 and 4.3% for 2026, with Nigeria’s growth slightly below the regional average but showing resilience amid global uncertainties. IMF Chief Economist Pierre-Olivier Gourinchas warned of downside risks, including potential tariff hikes and geopolitical tensions, but highlighted Nigeria’s reform gains as a buffer.
The forecast has sparked cautious optimism among Nigerian policymakers and analysts. Finance Minister Wale Edun described the revision as validation of the government’s economic strategy, emphasising plans to sustain reforms in energy, infrastructure, and non-oil sectors like telecommunications and financial services. However, experts like Bismarck Rewane of Financial Derivatives Company stressed that resolving Nigeria’s electricity crisis is critical for unlocking higher growth, warning that 3.4% is insufficient for transformative development.
Despite challenges, the IMF’s upgrade underscores Nigeria’s progress in stabilising its economy. With inflation projected to decline to 23.7% in 2025 from 31% in 2024, supported by tight monetary policies and increased food production, the outlook offers hope for improved living standards. As Nigeria navigates global and domestic hurdles, the revised forecast signals a brighter economic future, contingent on sustained reforms and strategic investments.
