The International Monetary Fund (IMF) this week raised Nigeria’s economic growth forecast for 2026 to 4.4 per cent, up from the 4.2 per cent projection in October 2025.

The revised outlook was contained in the IMF’s January 2026 update of the World Economic Outlook, unveiled on Monday.

The Fund explained that the upgrade was part of a broader assessment of global economic conditions, which it expects to remain relatively stable in the coming years.

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Nigeria’s improved forecast, it noted, is consistent with a gradual but widespread strengthening across Sub-Saharan Africa rather than an isolated revision.

Downgrades To Upgrades

Nigeria’s growth projections have fluctuated in recent years.

In July 2024, the IMF slashed Nigeria’s forecast to 3.1 per cent, citing weaker-than-expected GDP growth and surging inflation that hit 34.19 per cent in June 2024.

By July 2025, however, the Fund upgraded Nigeria’s 2025 forecast to 3.4 per cent, reflecting early signs of recovery.

In its October 2025 World Economic Outlook, the IMF projected Nigeria’s 2026 growth at 4.2 per cent, warning of lingering inflationary pressures, fiscal constraints, and structural bottlenecks.

Since then, Nigerian policymakers have intensified reforms aimed at stabilising the macroeconomic environment, strengthening fiscal coordination, and boosting productivity across agriculture, manufacturing, and services.

What It Means

The upward revision reflects confidence in Nigeria’s reform agenda, including efforts to rebuild fiscal buffers and preserve central bank independence.

A stronger outlook could attract foreign investment, particularly in non-oil sectors such as technology, agriculture, and renewable energy.

Nigerians abroad may see improved opportunities to channel remittances into productive ventures, leveraging a more stable macroeconomic environment.

With global inflation projected to ease from 4.1 per cent in 2025 to 3.8 per cent in 2026, Nigeria could benefit from reduced import costs and improved purchasing power.

The IMF also revised Sub-Saharan Africa’s growth upward, from 4.0 per cent to 4.1 per cent in 2025, and from 4.3 per cent to 4.4 per cent in 2026, highlighting a shared recovery trend.

Stability, Balance

Globally, growth is projected at 3.3 per cent in 2026 and 3.2 per cent in 2027, broadly in line with the estimated 3.3 per cent outturn for 2025.

According to the Fund, this stability reflects a balance between headwinds from shifting trade policies and tailwinds from technology-driven investment, including artificial intelligence, alongside accommodative financial conditions.

Economic experts have consistently highlighted Nigeria’s growth prospects as reform-driven but fragile, stressing the importance of fiscal discipline, structural reforms, and energy sector stability.

They note that while international institutions like the IMF and World Bank have upgraded Nigeria’s forecasts, inflationary pressures and policy timing remain critical risks.

But Nigeria’s expected growth of 4.4 per cent shows a stronger outlook compared to South Africa’s 1.4 per cent in 2026, despite a slight upward revision. Structural bottlenecks, policy uncertainty, and vulnerability to global shocks continue to weigh on the performance of the Southern African nation’s economy.