The International Monetary Fund (IMF) has upgraded Nigeria’s economic growth projection for 2025 to 3.4%, up from its previous estimate of 3.0%, citing stronger oil production and a robust services sector.

The revised outlook was contained in the IMF’s July 2025 World Economic Outlook Update, which also raised Nigeria’s 2026 growth forecast to 3.2% from 2.7%. The Fund noted that Nigeria’s economy grew by 3.4% in 2024, maintaining the same momentum this year.

“Recent reforms, including exchange rate liberalization, removal of fuel subsidies, and tighter monetary policy, have supported macroeconomic stability,” the IMF said in its Article IV Staff Report.

Global and Regional Outlook

The IMF also lifted its global growth forecast to 3.0% in 2025 and 3.1% in 2026, while projecting Sub‑Saharan Africa to grow by 4.0% in 2025 and 4.3% in 2026, slightly higher than earlier projections.

Challenges Remain

Despite the improved forecast, the IMF warned that Nigeria faces persistent challenges, including high inflation currently around 23.7% modest per capita growth of about 1.3%, and fiscal pressures from lower-than-expected oil prices.

The Fund urged the federal government to recalibrate its 2025 budget to reflect oil prices averaging $68 per barrel, below the $75 benchmark in the budget, and to expand cash-transfer programmes to support vulnerable households.

IMF’s Policy Recommendations

The IMF called for:

Continued fiscal discipline and improved revenue collection.

Strengthening social protection for poor and food-insecure households.

Reforms to deepen investor confidence and ensure debt sustainability.

While the upward revision signals cautious optimism, the IMF noted that Nigeria’s growth remains below the Sub‑Saharan African average and emphasized the need for sustained reforms to unlock the country’s full economic potential.