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The World Bank has stated that Nigeria is among a list of top 10 countries with high debt risk exposure.
Nigeria’s economy is showing signs of recovery, thanks to ongoing structural reforms, according to Taimur Samad, Acting Country Director of the World Bank for Nigeria. Speaking at the launch of the latest Nigeria Development Update (NDU) report titled “Building Momentum for Inclusive Growth” on Monday in Abuja, Samad pointed to key improvements in the economy, including a more stable exchange rate, rising foreign reserves, and improved fiscal performance.
He noted that economic growth accelerated to 4.6% year-on-year in the fourth quarter of 2024, bringing full-year growth to 3.4%—the strongest annual performance since 2014, excluding the post-COVID rebound.
“The fiscal deficit also narrowed significantly, dropping from 5.4% of GDP in 2023 to 3.0% in 2024,” Samad said. “This was largely due to a sharp rise in federation revenues, which climbed from N16.8 trillion (7.2% of GDP) in 2023 to an estimated N31.9 trillion (11.5% of GDP) in 2024.”
Despite these gains, Samad cautioned that challenges remain—particularly with high inflation. He stressed the need for the Central Bank of Nigeria to maintain tight monetary policies to sustain economic stability. If these measures are upheld, he projected inflation could ease to just above 22% on an annual average by 2025.
The report emphasized that continued reforms would be essential to attract private investment, create jobs, and drive inclusive growth.
Providing additional insights, Alex Sienaert, the World Bank’s Lead Economist for Nigeria, urged caution in managing revenues from fuel subsidy removal and warned against overly optimistic budget projections for 2025. He underscored the importance of expanding the targeted cash transfer programme to support vulnerable groups.
Sienaert also recommended a shift toward a private sector-led, government-supported growth model. Key priorities, he said, should include reducing the cost of governance, improving electricity and transport infrastructure, and creating a more open and competitive business environment.
He further stressed the need to improve access to finance, boost productivity, and implement policies that support both new and existing businesses in key sectors of the economy.
The Nigeria Development Update is a biannual World Bank publication that reviews economic and social developments in Nigeria while offering strategic guidance on the country’s medium-term development challenges.
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