Taimur Samad, World Bank’s Acting Country Director for Nigeria, has stated that the Nigerian economy is improving due to the country’s commitment to sustained reforms.
Samad made this statement based on the latest Nigeria Development Update (NDU) report, titled “Building Momentum for Inclusive Growth”, released on Monday in Abuja, which highlighted several key indicators of progress..
He said these include a stable exchange rate, rising foreign reserves, and improved fiscal conditions.
He said the improvements in fiscal conditions were primarily driven by increased federation revenues, which had contributed to the positive economic outlook for the country.
Samad mentioned that economic growth in the last quarter of 2024 had surged to 4.6 per cent on a year-on-year basis, bringing the full-year growth for 2024 to 3.4 per cent, the highest since 2014, excluding the 2021-2022 COVID-19 rebound.
“Additionally, the fiscal deficit shrank from 5.4 per cent of Gross Domestic Product (GDP) in 2023 to 3.0 per cent of Gross Domestic Product (GDP) in 2024.
“This positive trend was driven by a sharp rise in federation revenues, which increased from N16.8 trillion in 2023, 7.2 per cent of GDP to an estimated N31.9 trillion in 2024, 11.5 per cent of GDP.”
In spite of these gains, Samad emphasised that many challenges remained, including persistent high inflation.
He stressed the importance of the Central Bank of Nigeria maintaining tight monetary policies to ensure continued economic stability.
If successful, he projected that inflation would fall to just more than 22 per cent on an annual average by 2025, marking a major achievement.
The report also highlighted that staying the course on macro-fiscal reforms would provide an opportunity to foster private sector growth and create jobs for Nigerians.
“However, it was clear that sustained momentum and further reforms are necessary to drive growth and expand economic opportunities.”
Alex Sienaert, World Bank’s Lead Economist for Nigeria, provided further insights, stressing the need for careful monitoring of revenue gains from the fuel subsidy removal and cautioning against overly ambitious budget projections for 2025.
He also emphasised the importance of scaling up the targeted cash transfer programme to assist vulnerable populations.
Sienaert outlined several steps for achieving macroeconomic stability, including reducing the cost of governance and accelerating the pace of economic growth.
He called for a private sector-led, public sector-facilitated growth strategy to address critical infrastructure gaps, particularly in electricity and transportation, while fostering a competitive and open business environment.
Additionally, he emphasised improving access to finance and policies to help new and existing firms grow, boosting productivity, and unleashing the potential of key sectors.
The NDU is a biannual World Bank report that assesses economic and social developments in Nigeria and offers an in-depth analysis of the country’s medium-term development challenges.
