According to the latest Africa’s Pulse Report released by the World Bank on April 8, 2024, Nigeria is expected to grapple with persistently high inflation, projected at 24.8 percent year-on-year for the year.
The report also maintains the World Bank’s earlier forecast of 3.3 percent economic growth for Nigeria in 2024. However, projections for 2025 to 2026 have been slightly adjusted downward by 0.1 percentage points to 3.6 percent from the previous estimate of 3.7 percent, indicating cautious optimism.
The World Bank anticipates that ongoing macroeconomic and fiscal reforms will gradually bear fruit, leading to a more stable economic environment. However, growth in the non-oil sector is expected to remain sluggish, albeit sustained, while the oil sector may see some stabilization with a recovery in production and slightly lower prices. Structural reforms are deemed essential to foster higher growth rates.
Despite these efforts, inflation is forecasted to remain elevated at 24.8 percent in 2024, gradually easing to 15.1 percent by 2026 due to monetary policy tightening and exchange rate stabilization.
The report also highlights the concerning trend of food inflation across Sub-Saharan African countries, with several nations experiencing double-digit year-on-year rates. Notably, Nigeria is among those countries facing significant challenges in this regard.
Furthermore, the Africa region as a whole is grappling with high levels of extreme poverty, inequality, and a sluggish transmission of growth to poverty reduction. The pace of poverty reduction has slowed significantly since 2014, lagging behind global averages.
Nigeria, along with the Democratic Republic of Congo, is identified as a major contributor to extreme poverty in the region, underscoring the urgent need for targeted interventions to address these challenges and promote inclusive growth.