The International Monetary Fund (IMF) has raised its 2026 economic growth forecast for Nigeria to 4.2 per cent from 4.1 per cent, while warning that rising food and energy costs could worsen poverty and food insecurity.
The revised projection was contained in the Fund’s October 2026 World Economic Outlook, released on Tuesday, October 13.
The IMF attributed Nigeria’s improved outlook to greater macroeconomic stability and favourable trade conditions but cautioned that higher prices for essential goods would place additional pressure on vulnerable households.
“Higher prices for essentials are expected to further aggravate poverty and food insecurity,” the Fund said.
Speaking at a briefing, Deniz Igan, chief of the IMF research department’s world economic studies division, said the government must address immediate household needs while protecting the country’s medium-term fiscal stability.
“What we are advocating for is for policymakers to balance the near-term needs of the population, and that involves food security, that involves energy security,” Igan said.
She explained that despite Nigeria’s status as an energy exporter, economic growth had not eliminated the risk of widespread poverty.
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“While the growth held up in Nigeria, given energy exporter, poverty risks are still very high,” she said.
Igan recommended targeted financial assistance for vulnerable citizens, stating, “What we’re advocating for is cash transfers, income support, targeted temporary income support for the most vulnerable households in Nigeria.”
The IMF retained its 2026 growth forecast for sub-Saharan Africa at 4.5 per cent but warned that countries face varying economic pressures depending on their fiscal strength, exposure to commodity prices, climate risks and access to external financing.
“Oil-importing and non-resource-intensive economies are more vulnerable to higher energy and food prices, while some larger economies continue to benefit from earlier stabilisation and reform efforts,” the IMF said.
The institution also noted that many African economies were benefiting little from the global artificial intelligence boom while facing declining official development assistance.
Globally, inflation is projected to rise to 4.7 per cent in 2026 from 4.1 per cent in 2025 before falling to 4.1 per cent in 2027.
The IMF expects global trade growth to slow to 4.6 per cent in 2026 before recovering to 4.7 per cent in 2027.