The World Bank has revised its growth outlook for Nigeria, foreseeing a robust expansion of 3.3 percent in 2024, according to its Global Economic Prospects report for January 2024. The report also anticipates that the country’s per capita income will return to pre-pandemic levels by 2025, showcasing a resilient recovery from the impacts of the global health crisis.
In the Sub-Saharan African (SSA) region, which encompasses Nigeria, economic growth is estimated to have decelerated to 2.9 percent in 2023, attributed mainly to country-specific challenges. Nigeria, South Africa, and Angola collectively experienced a diminished growth rate, averaging 1.8 percent in 2023.
The improved economic outlook for Nigeria is credited to the gradual success of macro-fiscal reforms undertaken by the government. The report notes that growth is projected at 3.3 percent in 2024 and 3.7 percent in 2025, reflecting an increase of 0.3 and 0.6 percentage points, respectively, since June.
Key sectors expected to drive this growth include agriculture, construction, services, and trade, as highlighted in the report. These sectors are identified as significant contributors to the overall economic expansion in the coming years.
The report also points to the escalation in food prices across Nigeria over the past few years, influenced by factors such as government policies, including the removal of subsidies on petrol. President Bola Tinubu declared a State of Emergency in July to address rising food prices and directed that matters related to food and water availability be included within the purview of the National Security Council.
The World Bank’s report anticipates an easing of inflationary pressures linked to exchange rate reforms and the removal of fuel subsidies. As these concerns gradually ease, inflation is expected to stabilize.
While acknowledging these positive projections, the World Bank emphasizes the need for continued vigilance and policy adjustments to navigate potential challenges and uncertainties on the global economic horizon.
