The International Monetary Fund (IMF) has retained Nigeria’s economic growth projections at 4.1 per cent for 2026 and 4.3 per cent for 2027, expressing confidence that ongoing macroeconomic reforms will continue to support the country’s recovery despite mounting global uncertainties stemming from the conflict in the Middle East.
The projections, contained in the IMF’s July 2026 World Economic Outlook (WEO) Update titled “Global Economy in Crosscurrents of War and Technology”, remain unchanged from the forecasts released in April.
According to the report released yesterday, Nigeria’s growth outlook is being supported by improved macroeconomic stability and favourable terms of trade arising from its status as an oil-exporting nation. However, the Fund warned that rising prices of essential goods could offset part of these gains by worsening poverty and food insecurity across the country.
The report stated that, “Nigeria is supported by improved macroeconomic stability and favourable terms of trade effects, though higher prices for essentials are expected to further aggravate poverty and food insecurity.”
Speaking during the IMF’s virtual briefing on the July 2026 World Economic Outlook Update for Sub-Saharan Africa and Nigeria, Division Chief in the IMF’s Research Department, Deniz Igan, described Nigeria as one of the region’s stronger-performing large economies, noting that policy reforms have strengthened macroeconomic stability.
“Just to give you a sense, the two largest economies in the region, Nigeria is expected to grow at 4.1 per cent, quite stable, and this is supported by improved macroeconomic stability and favourable terms of trade, with Nigeria being an oil exporter,” Igan said.
She, however, cautioned that inflationary pressures on essential commodities remain a major concern.
“At the same time, tighter prices, so there is some offset to that positive terms of trade effect because higher prices for essentials are expected to aggravate poverty and food insecurity,” she added.
The Fund also retained Nigeria’s 2027 growth forecast at 4.3 per cent, as it noted that recent economic reforms are laying the foundation for sustained expansion despite persistent global headwinds.
For the global economy, the IMF projected growth to moderate to 3.0 per cent in 2026 from 3.5 per cent recorded in 2025, attributing the slowdown largely to the economic impact of the Middle East conflict, which is expected to offset part of the gains from the accelerating artificial intelligence driven technology cycle.
For Sub-Saharan Africa, the IMF projected economic growth of 4.3 per cent in 2026 before improving to 4.5 per cent in 2027. The latest forecast represents a 0.1 percentage point upward revision from the Fund’s April outlook.
Igan noted that the region had experienced broad based economic recovery in 2025 before the outbreak of the Middle East conflict altered the growth trajectory. “Let me start by noting that we actually had seen a broad based pickup in growth in 2025 in the region. We had an acceleration of growth to 4.5 per cent.
“Now, the war obviously has clouded the outlook for 2026, and we are now projecting a softening of growth to 4.3 per cent in the region as a whole,” she said.
Beyond the impact of higher energy prices, the IMF warned that increasing fertiliser costs pose an additional threat to many African economies, particularly as the price surge coincides with planting seasons in several countries.
“This is beyond the cost of energy for the region. What matters also is the increase in fertilizer prices that we have seen, and this is coinciding with the planting season in some countries, and it may hurt the agricultural sector, in addition to all the other impacts of energy prices. The agricultural sector accounts for a large share of some Sub-Saharan economies,” Igan noted.
She explained that the regional growth outlook conceals significant differences among African countries, with performance largely influenced by the extent of economic reforms, available policy space and exposure to both the Middle East conflict and emerging technology trends.
“Again, the overall picture, the relatively small softening to 4.3 per cent, is masking substantial divergence across countries. This reflects primarily the differences in policy space, how reform implementation has been going even before the shock arrived, but also how exposed different economies have been, both to the war and to the technology chain.
