Bank projects stronger growth in coming years, urges government to sustain economic reforms
By Staff Reporter
ABUJA — The World Bank has projected that Nigeria’s economy will grow by 4.3 per cent in 2026, up from 4.0 per cent recorded in 2025, citing improving economic conditions and the impact of ongoing government reforms.
The projection was contained in the bank’s latest Nigeria Development Update, released in Abuja, which also forecasts that economic growth will rise to an average of 4.4 per cent annually in 2027 and 2028.
According to the report, Nigeria’s economic performance improved in the first half of 2026, with gross domestic product (GDP) growing by 4.2 per cent, compared with 3.9 per cent in 2025.
The bank attributed the growth largely to activities in the services and agricultural sectors, while noting that sustained reforms would be essential to maintaining the positive outlook.
Among the key policy measures highlighted were the removal of petrol subsidies and the liberalisation of the foreign exchange market. The World Bank urged the Federal Government to maintain its reform programme to maximise the benefits for the economy.
The institution expressed optimism that continued improvements in economic conditions could help reduce inflation and poverty over time, although the gains would depend on the effective implementation of policies and the management of prevailing economic challenges.
INFLATION EXPECTED TO DECLINE
The World Bank projected that inflation could ease to about 12 per cent by 2028, from approximately 15 per cent, provided current economic trends and policy measures remain supportive.
However, the bank noted that rising global fuel prices and external economic pressures could slow the pace of improvement in living standards, particularly for low-income households.
It also identified the need for governments at all levels to improve spending efficiency and channel more resources into human capital development as part of efforts to reduce poverty and strengthen economic resilience.
STATES URGED TO IMPROVE SPENDING
The report disclosed that state government revenues rose by about 93 per cent in real terms between 2023 and 2025.
Despite the increase, the World Bank called on state governments to ensure that additional revenues translate into improved public services, better infrastructure and higher living standards for residents.
It stressed that efficient allocation of public funds would be critical to ensuring that economic growth produces tangible benefits for ordinary Nigerians.
FG WELCOMES PROJECTION
Reacting to the outlook, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, described the projections as evidence that the government’s economic reforms were yielding results.
Oyedele urged Nigerians to support the reforms, maintaining that the policy decisions were necessary to strengthen the economy and establish a foundation for sustainable growth.
The World Bank’s projection offers a cautiously positive outlook for Africa’s largest economy. However, the extent to which the forecast growth will improve household welfare will depend on the government’s ability to sustain reforms, control inflation, create jobs and ensure that economic gains reach a broader section of the population.
Source: Vanguard News, October 12, 2026.
