- The World Bank has projected a 3.6 per cent growth in Nigeria’s Gross Domestic Product in 2025 and 2026
- It also projected that inflation will decline within the period
- The Bank forecasts increased oil production but below the Organisation of Petroleum Exporting Countries quota for the country.
The World Bank has projected that Nigeria’s economy will grow by 3.6 per cent in 2025 and 2026 due to expected economic stability following ongoing reforms by the Federal Government.
This was contained in the Global Economic Prospects, January 2025 report of the World Bank published on Thursday, January 16.
The World Bank noted that the government's macroeconomic and fiscal reforms helped boost business confidence, even as the Central Bank of Nigeria (CBN) embarked on monetary tightening to address rising inflation and currency depreciation.
The Bank said growth in Sub-Saharan Africa will accelerate from 3.2 per cent in 2024 to 4.1 per cent in 2025 and 4.3 per cent in 2026 as financial conditions and inflation are expected to ease.
Nigeria’s 2025, 2026 GDP growth forecast
The World Bank said, “In Nigeria, Gross Domestic Product (GDP) growth increased to an estimated 3.3 per cent in 2024, mainly driven by services sector activity, particularly in financial and telecommunication services.
“Macroeconomic and fiscal reforms helped improve business confidence. In response to rising inflation and a weak naira, the Central Bank tightened monetary policy.
“Meanwhile, the fiscal deficit narrowed due to a surge in revenues driven by the elimination of the implicit foreign exchange subsidy, following the unification of the exchange rate and improved revenue administration.
“Growth in Sub-Saharan Africa (SSA) is expected to firm to 4.1 per cent in 2025 and 4.3 per cent in 2026, as financial conditions ease alongside further declines in inflation.
“Following weaker-than-expected regional growth last year, growth projections for 2025 have been revised upward by 0.2 percentage points and for 2026 by 0.3 percentage points, with improvements seen across various subgroups.
“At the country level, projected growth has been upgraded for nearly half of SSA economies in both 2025 and 2026.
“Growth in Nigeria is forecast to strengthen to an average of 3.6 per cent a year in 2025-26. Following monetary policy tightening in 2024, inflation is projected to gradually decline, boosting consumption and supporting growth in the services sector, which continues to be the main driver of growth.”
World Bank forecasts increased oil production but below OPEC quota
The World Bank added that Nigeria’s oil production is expected to increase in 2025 and 2026, but remain below the Organisation of Petroleum Exporting Countries (OPEC) quota.
“Oil production is expected to increase over the forecast period but remains below the OPEC quota,” it said.
Nigeria’s oil production growth has remained marginal in the last year.
Daily average oil production rose by 152,000 barrels per day (bpd) in November 2024, according to data from the newly released monthly oil market report by OPEC.
Nigeria’s oil production, including condensates, rose by 11 per cent, from 1.333 million barrels in October to 1.486 million in November 2024.
Despite the expected positive developments, the World Bank emphasised that “The baseline forecast implies that per capita income growth will remain weak over the forecast horizon.”
Nigeria’s GDP grew in Q3 2024
It would be recalled that the National Bureau of Statistics (NBS) reported that Nigeria’s GDP grew by 3.46 per cent year-on-year in the third quarter (Q3) of 2024.
The quarter’s GDP growth shows an increase from the 2.54 per cent recorded in Q3 2023 and an improvement from the 3.19 per cent growth recorded in the second quarter (Q2) of 2024.
The Q3 2024 GDP growth was driven by the Services sector, which rose by 5.19 per cent and accounted for 53.58 per cent of the aggregate GDP.
World Bank urges Nigeria to sustain economic reforms for 10 to 15 years
Meanwhile, TheRadar earlier reported that the World Bank said Nigeria needs to sustain its ongoing reforms for the next 10 to 15 years to achieve economic transformation.
This was disclosed by Indermit Gill, senior vice-president of the World Bank Group, on Monday, October 14 at Abuna during the 30th Nigerian Economic Summit (NES), organised by the NES Group (NESG) in collaboration with the Ministry of Budget and National Planning.
