• Experts suggest how to survive bad times
By Cosmas Omegoh
If the predictions of the World Bank and the International Monetary Fund (IMF) come to pass, Nigeria’s economic woes are sure to increase. And the result will be that a vast number of Nigerians will be mired in extreme poverty by 2027.
Economic experts are worried over the said looming doom, highlighting focus on what the country and the citizenry must begin to do now to starve off the imminent calamity. They are also emphasising on what individuals can possibly do to help themselves.
Recent claims by the World Bank and the IMF that more and more Nigerians will sink deeper below the acceptable poverty line in 2027 are not looking good. They do not offer any hope either. Rather, they suggest troubled times ahead which will see yet more Nigerians suffering grievously.
Currently, a wide spectrum of Nigerians is experiencing excruciating poverty. Many can no longer afford food; most cannot afford two square meals a day. The cost of doing so has gone astronomically high. The cost of other goods and services too has over the past two years become provocative. Inflation is at its worst, affecting all and sundry; salary earners are worse for it.
But while many Nigerians were thinking that they had seen the worst of times, two predictions – startling as they were – recently emerged that things would get worse.
Rising from their Spring Meetings in Washington, D.C, USA on April 26, 2025, the World Bank and the IMF highlighted a bad trend.
The World Bank in particular said that Nigeria’s poverty level would experience a sharp rise over five years, forecasting that more of the country’s citizens would further plunge below the poverty line in the next two years.
It noted that poverty in resource-rich and fragile countries, such as Nigeria would likely rise by 3.6 per cent between 2022 and 2027, adding that Nigeria would be the only country in sub-Saharan Africa to face the calamity.
It said: “Resource-rich countries are not expected to grow at the same rate as non-resource-rich ones, largely due to declining oil prices and weak governance.
“This lack of growth is closely tied to slower poverty reduction, and in some cases, worsening conditions.”
While Nigerians struggled to engage the issue, the IMF on its part added that Nigeria’s inflation would average 26.5 per cent in 2025 and spike to 37 per cent in 2026.
What predictions mean to Nigeria
Some experts have admitted that the predictions might hold some dire consequences for Nigeria already in distress.
Dr Lawrence Nwaodu, a development economist, is of the view that “both projections from the World Bank and IMF highlight serious economic concerns for Nigeria.”
He recalled that “the report highlighted a troubling trend: poverty in resource-rich and fragile countries, such as Nigeria, is expected to rise by 3.6 percentage points between 2022 and 2027 — making it the only country group in sub-Saharan Africa facing such an increase.”
In his view, “this projection is particularly concerning given Nigeria’s status as one of Africa’s large economies.”
Equally concerning, according to him, is the projected rise in Nigeria’s inflation figure.
He said: “Regarding inflation, the International Monetary Fund (IMF) forecasts that Nigeria’s inflation will average 26.5 per cent in 2025 and spike to 37 per cent in 2026, driven by structural inefficiencies, weak supply response, and exchange rate volatility.
“In contrast, the World Bank projects that headline inflation will ease to 22.1 per cent in 2025 and further moderate to 15.9 per cent by 2027.”
Another economist, Oriole Osifo expressed surprise that the international bodies were coming out with the forecast at a time like this. He wondered if it was not a ploy to blackmail the Nigerian government.
“Sadly, it is the same World Bank and the IMF that recommend toxic policies that do not offer the people any hope.
“Why are they coming out at a time like this with the kind of predictions we are hearing? Maybe that is a calculated attempt to pressure the Nigerian government to agree to a planned deal, who knows.”
In any case, he warned that what the World Bank and the IMF had said were grave enough to be neglected.
“In any case, the predictions of both agencies regarding Nigeria’s economy are weighty enough. They are not things the Nigerian government should sweep under the carpet as usual. They should serve as a wakeup call.
“The managers of the economy need to urgently weigh in on the concerns raised to ensure that the economy is shielded from further disaster.
“A prediction that more and more Nigerians will slip below the poverty line should be a serious concern to any responsible government,” he maintained.
What inspired prediction
While giving reasons both the World Bank and the IMF possibly gave their recent predictions, Dr Akin George Ogunleye, an associate professor, in the Department of Economics, Osun State University, Osogbo, Nigeria, did not express any surprise, recalling that a lot had been happening in Nigeria’s economic landscape.
He said: “With the removal of petrol subsidy and harmonisation of the foreign exchange market, prices have gone up considerably, fuelling the already high level of inflation. You also have to remember that Nigerians have been described as suffering from multi-dimensional poverty. These are clear issues as hardly can you find any area that Nigerians are not poor: food/calorie intake, security, health, decent housing, etc. All these give credence to the fears expressed about the living status of the average Nigerian in 2026 and beyond.”
Similarly, Dr Nwaodu reasoned that “the predictions of both financial institutions might be inspired by factors such as slow economic growth, high unemployment, insecurity, and declining real incomes.”
He went on to lament that “with over 60 per cent of the population already living in multidimensional poverty, the outlook is troubling unless major policy reforms and social safety nets are implemented.”
On the IMF’s prediction, he stated that “this projection stems from factors like currency depreciation, fiscal deficits, removal of fuel subsidies, and food supply chain issues. Persistently high inflation erodes purchasing power, making basic goods unaffordable for many and exacerbating poverty.
“These two indicators are interlinked —rising inflation reduces real income, which in turn drives more people into poverty.
“These projections highlight the complex economic challenges facing Nigeria, including high inflation, poverty, and slow economic growth.”
Osifo on his part, believes that the removal of subsidy on petrol and electricity and the floating of the naira without creating any buffers for the people were bad enough. He imagined what the situation would look like if more Nigerians fall below the poverty line in the next two years.
“Those twin policies which saw President Bola Tinubu yanking off subsidies on petrol and electricity and the floating of the naira were bad enough. Everyone can see where they have left the people and the economy.
“As of today, many industries have shut down. Some have left the country. Several SMEs have closed after their owners threw up their hands in surrender. Many have lost their jobs; many have been driven into the labour markets. Unfortunately the jobs are no longer there. Worse still, the people’s capacity to create jobs on their own has been whittled down. So if the people do not have jobs, they are bound to be poor if not poorer. Yet, there is nothing tangible being done now by the current government to shore up hope.
“It therefore goes to reason that if things stay the way they are at the moment over the months, more Nigerians are going to be much poorer. I guess that is where the international bodies are basing their predictions on.”
Should World Bank/IMF be taken seriously?
But should the predictions of both international financial institutions be taken seriously?
Dr Ogunleye’s answer is in the affirmative. He said: “The World Bank and the IMF are two major international financial institutions in the world today. Even though they are mainly controlled by America and the rest, their predictions have mostly been taken seriously by countries because they are hung on evidence.
“What they say about Nigeria and their fears about the country can be verified by the common man in the street.”
He warned that “Nigerians, no doubt, will be affected directly by the twin effects of inflation and poverty as prices continue to soar.”
He at the same time feared that “that there be consistent increase in the cost of living and a dwindling in people’s living standards” further afraid that “when people are hungry, they easily become angry.
“This will be further exhibited in the level of insecurity as people will be forced to engage in whatever form of activity to eke out a living.”
What needs to be done
Now that both the government and the people have heard the warning of the global institutions, what needs to be done to avert the looming dangers?
While answering the multitasking question, Dr Nwaodu advised that: “Averting the effects of this projected adverse economic conditions will require major reforms (that will empirically improve the value of the currency, reduce inflation (especially food inflation), drastically reduce insecurity and banditry all over the country, increase productivity and investments, to create employments and promote SMEs.”
He added that the nation needs to “also create and efficiently implement social safety nets for the vulnerable population especially the poor and fixed income population – providing subsidised public healthcare and transportation, and agriculture/farm support. These would have to be properly and efficiently implemented to avert the grave impact of the forecast challenging economic conditions for the country.”
Then turning to private individuals especially the younger persons, he counseled: “Exploiting innovation, the Internet, and digital technology for wealth creation,” is the right way to go now just as he recommended involvement “also in agriculture and food supply chain.”
He further advised that “people need to diversify their income streams and be frugal with finances, etcetera – to surmount any economic challenges that may come their way.”
Weighing in on the way forward, Dr Ogunleye who teaches Macro-economics and Development Economics recalled that: “Inflation arises from two main causes: the demand side and the cost of production. This shows that any solution must also focus on the causes.
“Cost of producing goods and services has to come down while supply must also rise. It is the twin effect that will work the magic in the Nigerian case.
“As of today, Nigeria’s inflation rate is above 20 per cent although down from a previous high of above 30 per cent; although the Central Bank of Nigeria is intending to bring it further down to a single digit level, there is no magic wand to this; and until the demand and the cost of production sides are fully taken care of, there remains a lot to fear about.”
Osifo suggested that the Nigerian government needed to go beyond rhetoric and sit up to work on the economy.
“There is no denying that the economy is very bad right now. That is the starting point for the government; failure to acknowledge that means the managers of the economy are living in denial.
“Therefore, the government needs to shore up its resolve to restart the economy by ensuring a fairly regular power supply. Where there is no power supply, what would the SMEs depend on? No country survives without power. That ought to be top of the government’s priority.
“Of course, the government needs to tackle insecurity with all the seriousness it deserves. Where the people cannot go to farm or have their crops destroyed or where they are kidnapped and killed by marauding herders, is too bad for the country. That means the farmers will stay poor. And that also means that the people will not have access to food. So food insecurity will be a bigger challenge.
“Then as for the people. They need to prepare for the worse.
“The young people need to appreciate the reality that is dawning on us all. Therefore, they should prepare themselves to embrace entrepreneurship. Let them begin to learn profitable skills. The era of white-collar jobs is going away.
“And what is more, we need to be prudent with our resources going forward. I will advise everyone to learn to begin to make good use of the resources available to them no matter how meager. We must acknowledge that the future is bleak,” he added.
To avoid the looming danger, therefore, a lot needs to be done differently. That is the considered view of Dr Ogunleye and here are his other thoughts: “Let the government and its agencies secure the lives and property of Nigerians; let farmers feel safe on their farms; let the level of corruption be reduced through severe punishment of offenders; let government fix our social infrastructure especially roads, and let there be improvement in the level of power supply.” He ended his submission on a poetic note by asserting thus: “And strictly (speaking), a little effort here and there might save the projected catastrophe.”