The International Monetary Fund (IMF) has upgraded Nigeria’s economic growth outlook, projecting the economy to expand by 3.9 percent in 2025 and 4.2 percent in 2026, buoyed by stronger domestic fundamentals and a rebound in oil production.
The latest projection, released in the IMF’s October 2025 World Economic Outlook, represents a significant upward revision from its July estimates of 3.4 percent for 2025 and 3.3 percent for 2026.
According to the IMF, the improved forecast reflects increased oil output, enhanced security in the Niger Delta, and greater investor confidence following ongoing fiscal and exchange-rate reforms. A more stable naira and the government’s commitment to fiscal discipline have also helped to restore macroeconomic balance.
“The combination of improved oil production, a more flexible exchange-rate regime, and gradual fiscal consolidation is beginning to strengthen Nigeria’s growth potential,” the IMF noted in the report.
The Fund said Nigeria’s limited exposure to global trade disputes, particularly renewed tariff tensions between major economies, has helped cushion the country from external shocks that have dampened growth elsewhere.
Despite the brighter outlook, the IMF warned that high inflation, weak revenue mobilization, and illicit financial flows continue to weigh on the economy. It urged the government to strengthen domestic revenue collection and sustain ongoing reforms to ensure long-term fiscal stability.
Nigeria’s recent GDP rebasing capturing more activity in the informal, digital, and refining sectors also contributed to the improved projections, offering a more accurate picture of the economy’s true scale.
Analysts say the IMF’s revision signals growing confidence in Nigeria’s reform trajectory but stress that policy consistency and private-sector participation will be crucial to sustaining the momentum beyond 2026.
