IMF Upgrades Nigeria’s Economic Growth Forecast with Cautious Optimism

 The International Monetary Fund (IMF) on July 29, 2025, revised Nigeria’s economic growth forecast upward to 3.8% for 2025, an increase from the 3.1% projected in April, as detailed in the latest World Economic Outlook update. 

This adjustment reflects a robust recovery in oil production, which has climbed to 1.7 million barrels per day following the operationalization of the Dangote Refinery, alongside a 5% growth in the non-oil sector, particularly agriculture and services, driven by policy reforms under President Bola Tinubu’s administration. The IMF highlighted the naira’s stabilization at ₦1,550 per dollar as a stabilizing factor, supported by a $2 billion foreign exchange intervention in June.

However, the report tempered optimism with warnings about persistent challenges, including a 33.4% inflation rate, projected to decline to 25% by year-end, and a fiscal deficit of ₦9.18 trillion, or 4.1% of GDP, straining public finances. The IMF recommended accelerating structural reforms, such as tax base expansion, to reduce debt servicing costs, which currently consume 60% of revenue. 

Local economists from the Nigerian Economic Summit Group (NESG) caution that this growth may not alleviate poverty, affecting 70 million Nigerians living below $2.15 daily, with rural areas seeing minimal benefits. The narrative of economic progress is cautiously positive, signaling potential under Tinubu’s policies, but its inclusivity and sustainability depend on addressing inflationary pressures and equitable resource distribution.