By David Akinmola
The International Monetary Fund (IMF) has revised Nigeria’s economic growth projection for 2025 upward to 3.4 per cent, citing gradual recovery driven by policy reforms, improved oil production, and easing inflationary pressures.
The latest forecast, released in the IMF’s July 2025 World Economic Outlook update, represents a moderate increase from the earlier 3.0 per cent projection made in April. The Fund noted that while Nigeria’s economy continues to face structural challenges, ongoing fiscal and monetary adjustments are beginning to yield positive results.
According to the IMF, Nigeria’s medium-term growth prospects are supported by stabilisation efforts by the current administration, including fuel subsidy removal, foreign exchange unification, and renewed focus on revenue mobilisation.
“These reforms, although painful in the short term, are necessary to place Nigeria’s economy on a more sustainable path,” the report said.
The IMF highlighted the uptick in oil output following improvements in pipeline security and increased investment in upstream production, alongside growing activity in agriculture and services sectors, as key drivers of growth into 2025.
It also acknowledged that Nigeria’s inflation remains high still hovering above 24% as of mid-2025—but is expected to decline gradually as monetary policy tightening continues and food supply chains stabilise.
The Fund, however, cautioned that risks remain tilted to the downside. These include volatility in global oil prices, persistent insecurity in key farming regions, and slow implementation of structural reforms. It advised Nigerian authorities to strengthen social protection mechanisms to cushion vulnerable households from the effects of adjustment policies.
In response to the IMF projection, Nigeria’s Ministry of Finance and the Central Bank of Nigeria (CBN) welcomed the revised outlook, describing it as a reflection of confidence in the country’s economic direction.
Speaking in Abuja, Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said: “The improved growth forecast validates the government’s tough but necessary policy decisions. We remain committed to building a resilient and inclusive economy.”
Similarly, CBN Governor Dr. Olayemi Cardoso said the apex bank would maintain a tight monetary stance to keep inflation in check while continuing to support the productive sectors through targeted interventions.
Analysts in the financial sector view the new projection as a signal of cautious optimism. “It’s a positive development that aligns with recent trends in the macroeconomic environment,” said Kunle Adeosun, Chief Economist at Brightview Capital. “But translating this growth into improved living conditions for citizens remains the bigger challenge.”
Nigeria’s projected 3.4% growth still falls short of the 6–7% expansion rate needed to significantly reduce poverty and absorb the country’s growing labour force. Nonetheless, the IMF’s revision suggests a slow but steady recovery may be underway provided reforms are sustained and well managed.
