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By Chinwendu Obienyi and Adanna Nnamani, Abuja
The World Bank has urged the Central Bank of Nigeria (CBN), to stay the course with its current tight monetary policy if it hopes to rein in inflation and stabilise the economy.
In its latest Nigeria Development Update (NDU), titled “Building Momentum for Inclusive Growth,” released in Abuja yesterday, the biannual report evaluated recent economic trends, policy responses, and set out priorities for sustaining reforms and promoting inclusive growth.
The report showed a significant improvement in macroeconomic indicators, particularly GDP growth, revenue mobilisation, and fiscal consolidation.
The bank projected that inflation could ease to an annual average of just over 22 per cent in 2025 provided current policy efforts were sustained.
However, the bank stressed that for Nigeria to become a $1 trillion economy within five years, it must grow five times faster than its present pace, highlighting the urgency of deeper reforms and private-sector-driven development.
The bank’s Country Director for Nigeria, Taimur Samad, noted that although macroeconomic indicators were showing signs of improvement, Nigeria’s inflation remained “high and sticky.”
He said reforms implemented in the past year have begun yielding positive results, including a more stable exchange rate, stronger foreign reserves, and improved fiscal revenues.
“There is a lot to be positive about in Nigeria. Growth is up. The exchange rate is more reflective of the market. Federation revenues are surging. But the war is not yet won,” Samad stated.
Samad added that sustaining a tight monetary stance will be critical to anchoring price stability and restoring investor confidence.
“It will be crucial for the CBN to stay the course with tight monetary policy to anchor stability. If it does so, we expect that inflation will fall to an annual average of just over 22 per cent in 2025 and that would be a major achievement”, he said.
In what amounts to a bold call to action, the Bank in the NDU report also said Nigeria will need to grow five times faster than its current pace to achieve the federal government’s $1 trillion economy target by the end of the decade.
According to the bank, the current sluggish growth trajectory, combined with structural bottlenecks, remains a major concern for inclusive development.
The May 2025 NDU report advocates for a private sector-led, public sector-facilitated growth model.
It argues that Nigeria’s public sector should play a dual role — not only as a regulator but also as an enabler of private enterprise.
The report warns that the continued absence of productive employment opportunities could further entrench poverty and youth frustration, heightening risks of unrest.
“The lack of jobs is not just a challenge for inclusive growth. It is a national security concern,” Samad emphasized.
Similarly, the World Bank recommended that Nigeria must deepen macro-fiscal reforms, improve the business climate, and invest in sectors that can rapidly create jobs, particularly for its large youth population.
The May 2025 edition of the NDU, themed “Expanding Opportunities for All Nigerians,” focuses on inclusive growth and builds on the October 2024 edition, which centered on employment.
“The NDU is more than just a report. It is a tool for collective reflection and action”, Samad said.
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