World Bank makes fresh forecast about Nigeria economy

By Philippine Duru

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Nigeria’s economy is projected to record stronger growth in 2026 and 2027, with the World Bank and other global financial institutions forecasting expansion of about 4.4 per cent, a development analysts say could mark the country’s fastest pace of growth in more than a decade.

The positive outlook comes amid ongoing economic reforms by the administration of President Bola Ahmed Tinubu, including the removal of fuel subsidies, foreign exchange market liberalisation, tax reforms and efforts aimed at boosting investor confidence.

According to recent projections by the World Bank, Nigeria is expected to sustain stronger economic momentum over the next two years as macroeconomic adjustments begin to yield results. Economists noted that improved fiscal management, increased domestic revenue mobilisation and a gradual recovery in oil production are expected to support the anticipated growth trajectory.

The projections place Nigeria among the fastest-growing major economies in Africa, with optimism that the country may witness its most robust economic expansion since the rebasing-driven growth era of the early 2010s.

Financial analysts said recent reforms in the foreign exchange market have started improving transparency and narrowing the gap between official and parallel market exchange rates. This, they argued, could encourage greater foreign direct investment inflows and improve access to foreign capital.

In addition, stronger performance is expected from sectors outside crude oil, particularly agriculture, telecommunications, financial services, manufacturing and the digital economy. Industry experts believe the continued rise of technology-driven businesses and fintech companies could further strengthen Nigeria’s non-oil exports and employment generation.

The country’s banking sector has also remained relatively resilient despite inflationary pressures, while recent recapitalisation plans announced by the Central Bank of Nigeria are expected to improve the sector’s capacity to support long-term economic growth and infrastructure financing.

However, economists warned that significant risks still threaten the optimistic outlook. Persistent inflation, high food prices, insecurity in food-producing regions, global oil price volatility and external economic shocks remain major concerns that could weaken projected gains.

Analysts also cautioned that while reforms have received commendation from international financial institutions, many Nigerians continue to face rising living costs and declining purchasing power. They stressed that the success of the reforms would largely depend on the government’s ability to cushion social impacts and ensure inclusive growth.

Energy experts further warned that any major disruption in global oil markets or a sharp decline in crude prices could affect government revenues and foreign exchange earnings, given Nigeria’s continued dependence on oil exports.

Despite the risks, market observers maintained that the improving projections signal renewed confidence in Africa’s largest economy. They added that if reforms are sustained and structural bottlenecks addressed, Nigeria could enter a period of more stable and diversified economic expansion over the next few years.