World Bank Forecasts Strong Economic Growth for Nigeria in 2025 Amid Inflation Concerns

The World Bank’s Nigeria Development Update report, launched on May 13, 2025, projects a 3.6% GDP growth for Nigeria in 2025, marking the country’s strongest economic outlook in a decade. Despite this optimism, persistent high inflation, driven by recent reforms, remains a significant challenge, requiring careful policy management to ensure inclusive growth.

Economic Performance in 2024

Nigeria’s economy grew by 4.6% year-on-year in Q4 2024, the fastest in a decade, according to World Bank economist Alex Sienaert. This growth was fueled by increased revenues, a stabilized exchange rate, and an improved fiscal position. The Central Bank of Nigeria’s reserves exceeded $37 billion, reflecting successful foreign exchange reforms.

Reforms and Inflation Challenges

President Bola Tinubu’s reforms, including fuel subsidy removal and naira devaluation, have driven inflation to a 28-year high of 28.9% in December 2023, with food inflation at 33.9%. These measures, while stabilizing the economy, have increased living costs, prompting calls for monetary discipline to curb price rises.