The April 2025 Spring Meetings of the Bretton Woods institutions, the World Bank and the International Monetary Fund (IMF), held in Washington D.C. offered a more robust assessment of the Nigerian economy by experts. The two institutions presented different projections on Nigeria’s economy. Relying on the recent rebasing of Consumer Price Index (CPI) by the Nigeria Bureau of Statistics (NBS), the World Bank projected a steadying but marginal economic growth that began from 2024, based on accelerated business activities in key areas of financial services, telecommunications, information technology, and the efforts of the federal government to boost oil production to meet the OPEC threshold.
On the other hand, and despite the reforms, the IMF forecast a gloomy future for the country with inflation projected to reach up to 26.5 percent in 2025 and 37.0 percent in 2026 due to “structural inefficiencies, a weak supply response, and exchange rate volatility.” Expectedly, Nigeria’s Coordinating Minister of the Economy, who doubles as the Minister of Finance, Mr. Wale Edun, and the governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, sounded optimistic based on the macro-economic reforms and increased foreign direct investment (FDI) under President Bola Tinubu.
Although the country is known the largest economy in Africa by gross domestic product (GDP), the World Bank’s report indicted Nigeria for harbouring 15 percent of extremely poor people on earth. Specifically, the global body noted that over 106 million Nigerians are living below the poverty line of $2.15 per day. The implication is that the country is the highest single contributor of critically pauperized people in sub-Saharan Africa. According to ThisDay, the report “warned that poverty in resource-rich and fragile economies, such as Nigeria, would worsen unless decisive structural reforms are urgently implemented.”
Before these forecasts, it was reported in 2024 that over 63 percent, or 133 million, Nigerians were living in multidimensional poverty. And as the dust over the latest projections were about to settle, Dr. Akinwunmi Adesina, the outgoing president of African Development Bank (AFDB), decried the country’s economic woes by noting that, “Our GDP per capita in 1960 was $1,847. Today, it stands at $824. Nigerians are worse off than 64 years ago.” He said that, “Underdevelopment should not be accepted as our destiny. We must break free from this pattern.”
Thus, one of the greatest challenges facing the country today is the problem of excruciating poverty. Those in the poverty bracket blossomed in recent years because of the upsurge in cost of living: food, energy, transportation, housing and other basic household necessities. There is no better symptom of hunger and poverty in the land than the huge and embarrassing number of beggars on the streets of Abuja, Nigeria’s capital, on a daily basis. Even with the increment in salaries of workers, the inflationary pull and the devaluation of currency have eroded their purchasing power. The jobless and the informal sector have no economic buffers either.
But Dr. Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise (CPPE), noted that the projections are avoidable, if necessary steps are taken. He suggested that the rising cost of living should be addressed, while efforts should be made to boost productivity. The executive director, Civil Society Legislative and Advocacy Centre (CISLAC), Awual Rafsanjani, located the root causes of the unending poverty in Nigeria to governance issues. Thus he noted that, “This report coming from the World Bank is not surprising to us because all the signs are there. We have been advising the Nigerian government to carry out better reforms, economic reforms to address poverty, inequality and ensure financing for development, and block or reduce or minimize opportunities for corruption and embezzlement.” He was of the view that, ”There’s no way you can have this kind of tendency of reckless spending, looting, excessive borrowing for just personal consumption or diversion and lack of productivity in the economy without adverse consequence…If this kind of mindset is continued, there’s no way you can deal with the issues of poverty and inequality because, if the whole idea of governance is to grab the resources, is to steal the money, is to institutionalize impunity and recklessness in governance, definitely, you will continue to witness more Nigerians experiencing poverty.”
Cuing from the foregoing, the politics of this nation deserves fundamental reforms, if we are to get it right. As ‘the only game in town,’ politics dominates every activity, and the political class tends to weaponize poverty for power consolidation. We must find a way to promote probity and transparency in public procurement so that resources meant for public good will not end up in private pockets. Also, with the use of credible data, there should be targeted and well-organized stimulus packages to the aged and vulnerable persons, especially in rural areas, to increase their purchasing power. Government must incentivize agriculture for the youth as low-hanging fruits for job creation and economic empowerment. Massive investments in quality and affordable education and health, with subsidies for the poor should be mainstreamed in our national and state policies. Access to finance and tax incentives to the small and medium scale enterprises are critical. There should be a national action plan for poverty reduction with timelines. It will be more impactful with the collaboration of states and LGAs.
Ideas on how to tackle poverty are not lacking. Global Rights Nigeria makes a case for investment in “social safety nets like access to social security services for the unemployed, affordable housing, improving access to electricity, access to nutritious food particularly for children, ensuring the efficient and transparent implementation of such initiatives.” ActionAid Nigeria also “challenged the government to fully strengthen and expand social protection, including universal cash transfers and food support for the most vulnerable. They also called for the protection of smallholder farmers by tackling insecurity and ensuring access to markets, inputs, and tools to boost local food production.” Indeed, these practical steps can help to stave off the prediction that more Nigerians would be poor by 2027.