•Say naira to appreciate moderately by Q1
By Chinwendu Obienyi
Economic experts at a recent FirstBank forum has shed light on a cautiously optimistic outlook for Nigeria’s economy in 2025, highlighting potential drivers for recovery and sustained growth.
Speaking at the Nigerian Economic Outlook 2025 event themed; Nigeria 2025: Path to Economic Rebound and Recovery, which was organized by First Bank in Lagos, the Chief Executive Officer, First Bank Group, Olusegun Alebiosu, expressed optimism that the proposed N49.7 trillion 2025 budget will provide sufficient economic stimulus for households and businesses in Nigeria.
He ascertained that early indicators suggests that the country’s economy will improve in 2025 compared to the previous year while noting that the impacts of some of the painful reforms pursued by the government had exerted considerable strain on household and corporate incomes in 2024, with inflation reaching a three-decade high of 34.60% in November 2024.
However, he emphasized that 2025 looks more promising. “The Government’s proposed NGN49.7 trillion 2025 budget is expected to provide sufficient economic stimulus in view of the lower likelihood for poor budget implementation due to improving the Government’s revenue position,” Alebiosu stated.
Looking at the indicators, Alebiosu pointed out several early signs of economic improvement.
“The GDP grew steadily on a quarter-on-quarter basis in 2024, with the highest growth of 3.46% recorded in Q3.
Additionally, the revenue-to-debt service ratio improved to 68%, and foreign reserve balances grew to over $40 billion.
The introduction of the electronic foreign exchange matching system in December 2024 contributed to market stability.
Also, increased competition in Nigeria’s downstream sector led to falling prices of premium motor spirit (PMS). The reactivation of the Port Harcourt and Warri refineries further supported economic recovery”, the First Bank CEO stated.
Also speaking at the forum, the Chief Executive Officer, Financial Derivatives Limited, Bismarck Rewane predicted that 2025 will distinguish between strategic and reactive thinkers.
He expects Nigeria’s economy to grow gradually, noting that the country is closer to equilibrium, meaning the impact of changes will be less severe than in 2024.
Following the stability of the currency in December 2024, Rewane believes the naira will appreciate moderately at the end of the first quarter of 2025.
However, he noted that the government’s target of bringing down inflation to 15% is just a tall dream.
“The 15% inflation target is very bullish and aspirational, and everybody is free to have aspiration. The reality is that we think inflation will reduce to between 25% and 27% in 2025”.
These projections reflect optimism grounded in improving macroeconomic indicators, while caution persists around inflation control and the full realization of fiscal goals.
It will be recalled that President Bola Tinubu on December 18, 2024, presented N49.7 trillion as the proposed 2025 budget to the joint session of the National Assembly.
In the proposed budget, the Federal Government allocated a total of N231,737,478,756 billion for immunization, malaria vaccination, and a vaccine tracking system. Of the total amount, N188, 472,771,130 billion is dedicated to GAVI (Global Alliance for Vaccines and Immunization), supporting immunization programs nationwide.
The federal government also allocated N4 billion to the construction of a new presidential helipad and jetty in Lagos. This allocation falls under the Ministry of Works, which received a total of N1.1 trillion for 2025. Capital expenditures account for N1.09 trillion, reflecting a commitment to significant infrastructure projects.
For the Green Line Metro Rail Project, N146.14 billion was budgeted as counterpart funding. The project is a 68km rail network that will stretch from the Lekki Free Zone to Marina, connecting key areas of Lagos, including Victoria Island, Lekki and Ajah.
The National Assembly is expected to pass the 2025 budget in the first week of February.
The joint committee on appropriation of the two chambers of the National Assembly will present their report on the N49.7 trillion 2025 Appropriation Bill for consideration and approval on January 31.