IMF: Nigeria’s Economy to Grow 4.1% in 2026 But Higher Prices Will Deepen Poverty

Nigeria’s economy is projected to grow 4.1 per cent in 2026 and 4.3 per cent in 2027, the International Monetary Fund (IMF) said, crediting improved macroeconomic stability and favourable terms of trade even.

The Fund however warned that rising prices for basic goods will further deepen poverty and food insecurity across the country.

The forecast, contained in the IMF’s July 2026 World Economic Outlook Update released on Wednesday, leaves Nigeria’s growth projection unchanged from the Fund’s April estimate, a sign of stability at a time when many economies worldwide are seeing their outlooks revised.

Nigeria’s growth also outpaces the 4.0 per cent recorded in 2025, positioning the country broadly in line with the sub-Saharan African average of 4.3 per cent projected for 2026.

The favourable terms of trade cited by the IMF reflect Nigeria’s position as a net energy exporter at a time when global oil prices have been pushed higher by the war in the Middle East.

The Fund projects average petroleum prices of $89.27 per barrel in 2026, a 32 per cent increase over 2025 levels, a windfall for oil-exporting economies even as it raises costs elsewhere in the economy.

That same dynamic, however, sits at the centre of the IMF’s warning. Higher energy and fertiliser prices are pushing up the cost of food and essentials worldwide, with the Fund projecting global food prices to rise 8 per cent and fertiliser prices by 26 per cent in 2026.

For Nigerian households already navigating a difficult cost-of-living environment, the Fund’s bluntly stated that higher prices for essentials are expected to further aggravate poverty and food insecurity.

Nigeria’s experience mirrors a broader pattern the IMF identifies across sub-Saharan Africa, where growth is expected to remain broadly stable at 4.3 per cent in 2026, masking sharp divergence between countries.

Larger economies benefiting from earlier stabilisation and reform efforts, a category in which the IMF places Nigeria, are faring better than oil-importing, non-resource-intensive economies elsewhere on the continent, even though the region as a whole remains largely absent from the artificial intelligence-driven technology boom lifting growth in Asia.