IMF upgrades Nigeria’s growth projection to 3.4%

The International Monetary Fund (IMF) has upwardly reviewed Nigeria’s 2025 economic growth forecast to 3.4%, showing 0.4 percentage point increase from the 3.0% projection in its April 2025 World Economic Outlook (WEO). This revision outlined in the IMF’s latest July 2025 WEO Update titled, “Global Economy: Tenuous Resilience amid Persistent Uncertainty.” It signals renewed optimism […]

The International Monetary Fund (IMF) has upwardly reviewed Nigeria’s 2025 economic growth forecast to 3.4%, showing 0.4 percentage point increase from the 3.0% projection in its April 2025 World Economic Outlook (WEO).

This revision outlined in the IMF’s latest July 2025 WEO Update titled, “Global Economy: Tenuous Resilience amid Persistent Uncertainty.”

It signals renewed optimism about Nigeria’s near-term economic prospects despite global uncertainties and domestic macroeconomic challenges, the report noted.

The update shows that Nigeria is expected to maintain this 3.4% growth in 2025, followed by a slightly lower 3.2% growth rate in 2026, which itself is a 0.5 percentage point upward revision from the IMF’s April forecast.

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This upgrade is coming a few days after the National Bureau of Statistics (NBS) released the Gross Domestic Product (GDP) report,  showing the economy grew by 3.13 percent in the first quarter of 2025 from the 2.27 percent recorded in the same period in 2024.

These upgrades reflect a broader improvement in the global outlook, driven by more favourable financial conditions, a temporary easing in tariff pressures, and resilient trade activity.

The Fund’s projection still places Nigeria ahead of South Africa but below the broader Sub-Saharan African region average growth.

South Africa’s growth forecast remains unchanged at 1.0% for 2025 and 1.3% for 2026, while Sub-Saharan Africa’s growth is projected at 4.0% in 2025 and 4.3% in 2026, with only a 0.2 and 0.1 percentage point revision, respectively.

Global economy to rise by 3.0 %

Similarly, Global growth is projected at 3.0 percent for 2025 and 3.1 percent in 2026.

The forecast for 2025 is 0.2 percentage point higher than that in the reference forecast of the April 2025 World Economic Outlook (WEO) and 0.1 percentage point higher for 2026.

The report said, “This reflects stronger-than-expected front-loading in anticipation of higher tariffs; lower average effective US tariff rates than announced in April; an improvement in financial conditions, including due to a weaker US dollar; and fiscal expansion in some major jurisdictions.

“Global headline inflation is expected to fall to 4.2 percent in 2025 and 3.6 percent in 2026, a path similar to the one projected in April. The overall picture hides notable cross-country differences, with forecasts predicting inflation will remain above target in the United States and be more subdued in other large economies.”

The report further stated that risks to the outlook are tilted to the downside, as they were in the April 2025 WEO. A rebound in effective tariff rates could lead to weaker growth.

“Elevated uncertainty could start weighing more heavily on activity, also as deadlines for additional tariffs expire without progress on substantial, permanent agreements. Geopolitical tensions could disrupt global supply chains and push commodity prices up.

“Larger fiscal deficits or increased risk aversion could raise long-term interest rates and tighten global financial conditions.”