IMF forecasts 3% growth for Nigeria in 2025
Agency Report
The International Monetary Fund (IMF) has projected that Nigeria’s economy will grow by 3.0 per cent in 2025, rising slightly to 2.7 per cent in 2026, according to its latest World Economic Outlook report released on Tuesday.
Despite the forecasted growth, the IMF warned that Nigeria continues to grapple with deep-rooted economic challenges, including soaring inflation, foreign exchange volatility, and persistent infrastructure deficits.
However, it noted that recent policy reforms — such as the partial unification of exchange rates and the removal of petrol subsidies — offer a pathway to stabilizing the economy and attracting investment if consistently implemented.
“The growth projection reflects cautious optimism,” said Dr. Kemi Adesina, a Lagos-based economist and senior policy analyst.
“The government’s efforts to reform the forex market and cut down on unsustainable subsidies are necessary steps, but structural weaknesses remain. If inflation is not tamed and infrastructure remains weak, growth may fall short of expectations.”
According to the IMF report, Nigeria’s efforts to stabilize its economy must be complemented by stronger fiscal discipline, improved governance, and greater support for sectors outside oil, such as manufacturing and agriculture, to achieve inclusive growth.
Commenting on the report, Professor Ayo Bello of the University of Abuja’s Department of Economics said, “It’s encouraging to see moderate growth forecasts, but the real question is sustainability. The policy moves so far are right, but execution remains Nigeria’s Achilles heel. Investors want predictability, and that requires deep reforms, not just announcements.”
The IMF also stressed that for Nigeria to fully benefit from the projected growth, it must address rising cost-of-living pressures caused by high inflation, which has eroded household incomes and weakened consumer demand.
Nigeria’s annual inflation rate rose slightly to 24.23 per cent in March 2025, from 23.18 per cent in the prior month, which was the softest since June 2023.
Food inflation, the largest component of the inflation basket, remained elevated but eased to 21.79 per cent from 23.51 per cent in the prior month.
The core inflation, which excludes the prices of volatile agricultural products and energy quickened to 24.43 per cent, from 23.01 per cent in the previous month.
On a monthly basis, consumer prices rose by 3.90 per cent in March, accelerating from 2.04 per cent in February
Forex market instability has also deterred foreign direct investment, with many international businesses citing difficulty in accessing dollars at predictable rates.
The IMF’s outlook suggests that while Nigeria is on the right path, policy consistency, macroeconomic stability, and strengthened institutional frameworks remain critical to converting modest projections into sustained prosperity.
