The World Bank says Nigeria’s economy is showing strong signs of improvement, thanks to the country’s commitment to far-reaching economic reforms.
Taimur Samad, the Bank’s Acting Country Director for Nigeria, made the remark on Monday in Abuja while presenting the latest Nigeria Development Update (NDU) report titled “Building Momentum for Inclusive Growth.”
He said key indicators—such as a stabilised exchange rate, rising foreign reserves, and strengthened fiscal conditions—signal positive progress.
According to Samad, improved fiscal conditions were largely driven by a sharp rise in federation revenues, contributing to a brighter economic outlook.
He noted that Nigeria’s economy grew by 4.6% year-on-year in the last quarter of 2024, bringing full-year growth to 3.4%—the highest since 2014, excluding the 2021–2022 post-pandemic rebound.
“Also, the fiscal deficit narrowed significantly, from 5.4% of GDP in 2023 to 3.0% in 2024,” he said.
“Federation revenues nearly doubled, rising from N16.8 trillion (7.2% of GDP) in 2023 to an estimated N31.9 trillion (11.5% of GDP) in 2024.”
However, Samad acknowledged that challenges remain, particularly the persistence of high inflation. He underscored the importance of the Central Bank of Nigeria maintaining tight monetary policies to stabilise the economy.
He projected that, if current efforts are sustained, inflation could ease to just over 22% on average by 2025—a significant step forward.
The report also stressed that sustaining macro-fiscal reforms will be key to unlocking private sector growth and job creation.
“Nevertheless, it is clear that continued momentum and deeper reforms are essential to drive inclusive growth and expand economic opportunities,” Samad added.
Alex Sienaert, the World Bank’s Lead Economist for Nigeria, called for prudent management of revenue gains from fuel subsidy removal and warned against overly optimistic budget assumptions for 2025.
He urged an expansion of the targeted cash transfer programme to support vulnerable Nigerians.
Sienaert outlined further steps for macroeconomic stability: reducing the cost of governance, accelerating growth, and prioritising a private sector-led, public sector-supported development model.
He emphasised the need to close infrastructure gaps—particularly in electricity and transportation—create a more competitive business environment, improve access to finance, and boost productivity in key sectors.
The Nigeria Development Update (NDU) is a biannual World Bank publication that analyses Nigeria’s economic and social trends and outlines key medium-term development challenges. (NAN)
