Nigeria’s economic reforms yielding gains, but poverty levels remain high – IMF

Nigeria's stringent economic reforms are yielding positive macroeconomic outcomes and bolstering investor confidence, the International Monetary Fund reported. However, the West African nation continues to grapple with elevated poverty levels, with 63% of its population living below the national poverty line and 27 million people facing food insecurity in late 2025.

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Strong reforms over the past three years have yielded improved macroeconomic outcomes and built resilience. Still, conditions for many Nigerians remain difficult.

Since May 2023, President Bola Tinubu's administration has implemented significant reforms, including removing costly fuel subsidies, unifying exchange rates, adopting orthodox monetary policies, and revamping the tax system. These measures aim to attract international investors and accelerate economic growth. Recent initiatives involve recapitalizing the banking and insurance sectors as part of a broader goal to achieve a trillion-dollar economy by 2030.

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Poverty reached 63 per cent (national poverty line), and 27 million Nigerians are estimated to have faced food insecurity in the fall of 2025.

Despite praise from international financial institutions, these reforms have contributed to a cost-of-living crisis, marked by soaring energy and food prices. The IMF projects Nigeria's economy to grow by 4.1% in 2026, slightly up from 4% in 2025. Yet, it cautioned that rising food and transportation costs could impede economic activity, even as global commodity price spikes are expected to boost Nigeria's export earnings and government revenues.

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While the external shock to fuel and food prices will push up inflation in the short run, the disinflation path is projected to continue in the second half of the year.

The Nigerian government welcomed the IMF's assessment, viewing it as an endorsement of President Tinubu's economic agenda. The Ministry of Finance highlighted the report's recognition of improvements in macroeconomic stability, foreign exchange market reforms, fiscal management, and investor confidence, stating it validates the necessity and impact of the undertaken reforms.

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The report provides further independent validation that the bold and necessary reforms undertaken under the leadership of President Bola Ahmed Tinubu are strengthening.