63% of Nigerians living in poverty despite reduced inflation rate – World Bank

Nigeria’s poverty crisis deepened in 2025, with 63 per cent of the population now living below the poverty line, despite a sharp drop in inflation, according to the World Bank.

The figure marks a steady rise from 56 per cent in 2023 to 61 per cent in 2024, showing that recent macroeconomic improvements have not translated into better living conditions for millions of households.

The data is contained in the bank’s latest Nigeria Development Update, released in Abuja, which assessed the impact of ongoing economic reforms on household welfare.

According to the report, about 140 million Nigerians are now classified as living in poverty, even as inflation pressures begin to ease.

Inflation has slowed significantly during the period under review. Headline inflation dropped from 34.8 per cent in December 2024 to 15.15 per cent by December 2025, while food inflation also recorded a sharp decline.

However, the bank warned that the benefits of easing prices have not been fully felt by households, as earlier inflationary shocks had already eroded real incomes.

It stated that income growth has remained too weak to offset the impact of previous price increases, meaning many Nigerians are still struggling despite the recent slowdown in inflation.

140 million Nigerians trapped in poverty despite easing inflation

The World Bank warned that about 140 million Nigerians are now below the poverty line, as slow income growth continues to weaken the impact of falling inflation, leaving household welfare largely unchanged.

It explained that although inflation is declining, many households had already suffered significant losses in purchasing power during earlier spikes, making recovery slow and uneven.

“Incomes coming into households have not increased sufficiently to cover the impact of still-high inflation, and poverty has yet to start falling,” the report stated.

Beyond inflation, the report pointed to structural weaknesses in Nigeria’s economy as a key constraint. Growth has been driven largely by services and industry, while agriculture, which employs more than half of the poor, has lagged.

This imbalance, the bank said, has limited income growth among vulnerable groups and slowed the transmission of economic growth into improved living standards.

The report also highlighted external pressures, including global energy and food price shocks linked to tensions in the Middle East, which continue to add pressure on inflation and household costs.

Speaking at the report’s launch, the World Bank’s lead economist for Nigeria, Fiseha Haile, said inflation, though declining, still threatens real incomes and slows poverty reduction.

He stressed the need for sustained price stability and more inclusive growth to ensure Nigerians benefit from ongoing reforms.

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The World Bank projects that poverty levels could begin to decline gradually from 2026, potentially falling to about 59 per cent by 2028, if inflation continues to ease and economic conditions improve.

However, it warned that progress will remain slow unless structural challenges such as weak job creation, low agricultural productivity, and inequality are addressed.

Also speaking, Nigeria’s Minister of Finance, Wale Edun, said government reforms are focused on investment-led growth and stronger social protection systems aimed at reducing poverty levels.