Nigeria’s debt-to-GDP ratio is projected to decline to 39.8 percent in 2025 from about 42.9 percent, according to the World Bank’s latest Nigeria Development Update.

The Bank attributed the improvement to ongoing economic reforms, including fuel subsidy removal, exchange rate unification, and stronger non-oil revenue growth. These measures, it said, are helping to stabilize public finances and reduce the fiscal deficit.

Nigeria’s economy grew by 3.9 percent year-on-year in the first half of 2025, while external reserves rose above $42 billion. The fiscal deficit is expected to narrow to 2.6 percent of GDP.

However, the World Bank warned that many Nigerians are yet to feel the impact of these reforms, with food inflation and widespread poverty affecting about 139 million people remaining major concerns.

The report urged the government to sustain policy consistency and expand social protection to ensure that reform gains translate into better living conditions.