The International Monetary Fund (IMF) has expressed concern over the lack of a robust social safety net to shield poor Nigerians from the harsh impact of ongoing economic reforms. In an article published Monday, the IMF acknowledged that while Nigeria has made progress in reforming its economy, widespread poverty and food insecurity remain critical issues threatening inclusive growth. The article was jointly authored by the IMF’s Mission Chief to Nigeria, Axel Schimmelpfennig, and its Resident Representative, Christian Ebeke.

According to the IMF, Nigeria’s current administration inherited a struggling economy marked by stagnant growth, declining per capita income, and a poverty rate of 42 per cent in 2023. Reforms such as fuel subsidy removal, foreign exchange market liberalisation, and halting central bank deficit financing have begun to yield positive outcomes. However, the Fund noted that millions of Nigerians have yet to benefit from these changes due to the absence of effective social buffers.

The IMF acknowledged recent gains, including improved access to foreign exchange, rising international reserves, and a successful return to the international capital market. Yet, it warned that high inflation, unreliable power supply, and vulnerable oil revenues continue to hinder economic stability. The organisation stressed that scaling up the current cash transfer programme is vital to making growth more inclusive.

Looking ahead, the IMF outlined three key policy priorities for Nigeria: accelerating inclusive growth, improving infrastructure and social spending through transparent budgeting, and boosting domestic revenue via ongoing tax reforms. The Fund emphasized that reinvesting savings from subsidy removal into essential services and ensuring a functional safety net are crucial to unlocking Nigeria’s full potential.