The International Monetary Fund (IMF) has praised Nigeria’s recent economic reforms, highlighting improvements in macroeconomic stability and resilience amid a challenging global environment.
In its 2025 Article IV Consultation report released on July 2, 2025, the IMF projected Nigeria’s real GDP growth at 3.4 percent for the year, supported by increased oil production, the commissioning of a new domestic refinery, and a robust services sector.
The IMF acknowledged the Central Bank of Nigeria’s (CBN) tight monetary policy stance, which it recommended be maintained until inflation is firmly under control. Inflation eased to 23.7 percent year-on-year in April 2025, down from an average of 31 percent in 2024, aided by improved food supply, a more stable naira, and effective foreign exchange market reforms.
Key reforms commended include the removal of fuel subsidies, the cessation of monetary financing of fiscal deficits, and strengthened governance at the central bank. These efforts have bolstered investor confidence, enabling Nigeria to successfully tap the Eurobond market and attract portfolio inflows.
Despite these gains, the IMF warned that poverty and food insecurity remain significant challenges, urging the government to accelerate cash transfers and social support for vulnerable populations.
The fund also highlighted persistent structural issues such as poor electricity supply, insecurity, limited access to credit, and bureaucratic bottlenecks that continue to constrain growth.
Fiscal performance improved in 2024, with enhanced revenue mobilization offsetting rising interest payments. The IMF called for a neutral fiscal stance that prioritizes growth-enhancing investments while safeguarding macroeconomic stability.
Looking ahead, the IMF emphasized the importance of addressing security concerns, boosting agricultural productivity, expanding infrastructure—especially power supply—and improving health and education spending to sustain inclusive growth. It also stressed the need for continued reforms in the financial sector, including risk-based supervision of emerging sectors like fintech and cryptocurrency.
The IMF cautioned that downside risks remain elevated due to global economic uncertainties, potential oil price declines, rising financing costs, and domestic security challenges, all of which could impact growth, fiscal stability, and the exchange rate.
Nigeria’s Minister of Finance, Wale Edun, welcomed the IMF’s recognition of the government’s reform efforts and reiterated the commitment to sustaining policies that strengthen the economy and improve the welfare of Nigerians.
The report underscores the critical need for agile policymaking to navigate complex challenges while building on recent reform successes to foster sustainable economic growth and reduce poverty.
