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World Bank has projected that Nigeria’s public debt is expected to decline for the first time in over a decade from 42.9 to 39.8% of Gross Domestic Product (GDP), and on the fiscal side, federal deficit is expected to remain at 2.6% of GDP in 2025, despite lower oil prices.

This is contained in the latest Nigeria Development Update (NDU) released by the World Bank on Wednesday.

The World Bank said, “The country’s external position has strengthened, with foreign reserves exceeding $42 billion and the current account surplus rising to 6.1% of GDP, supported by higher non-oil exports and lower oil imports.

“On the fiscal side, despite lower oil prices, the federal deficit is projected at 2.6% of GDP in 2025, broadly unchanged from 2024, while public debt is expected to decline for the first time in over a decade from 42.9 to 39.8% of GDP”.

It noted that Nigeria has taken important steps toward stabilizing its economy through recent policy reforms, but more needs to be done to ensure these gains translate into better living standards for its citizens.

Titled “From Policy to People: Bringing the Reform Gains Home,” the report notes progress in economic growth, domestic revenue mobilization, monetary policy, and external balances while underscoring persistent challenges such as high food inflation, widespread poverty, and structural barriers that constrain inclusive growth.

According to the NDU, Nigeria’s economy expanded by 3.9% year-on-year in the first half of 2025, up from 3.5% in the same period of 2024.

However, the report cautions that these macroeconomic gains have yet to translate into tangible improvements in people’s lives.
Many households continue to face hardship, with poverty and food insecurity remaining high.

Food inflation remains a major concern: poor households, who spend up to 70% of their income on food, have seen the cost of a basic food basket rise fivefold between 2019 and 2024.

The NDU notes that while current reforms are addressing long-standing policy distortions, sustained progress in livelihoods will depend on continued efforts to reduce inflation, foster inclusive growth, strengthen public services, and expand support for the most vulnerable.

Mathew Verghis, World Bank Country Director for Nigeria, said,

“The Nigerian government has taken bold steps to stabilize the economy, and these efforts are beginning to yield results. But macroeconomic stability alone is not enough. The true measure of success will be how these reforms improve the daily lives of Nigerians—especially the poor and vulnerable.”

To help bridge the gap between macroeconomic progress and improved welfare, the report identifies three urgent priorities.

“Tackling food inflation by removing trade barriers such as import bans and excessive duties, while addressing structural bottlenecks in seeds, input supply, security, logistics, and infrastructure (including transport, power, storage, and cold chains).

“Improving the efficiency of public spending through greater fiscal transparency, stronger discipline in Federation Account (FAAC) deductions, and a national pact to align fiscal policy with development objectives, especially human capital investments.

“Expanding and institutionalizing social protection, including regular, domestically financed cash transfers for the ultra-poor and a shock-responsive safety net system to help households manage crises.”

The NDU states that the outlook for Nigeria’s economy remains cautiously optimistic, as growth is projected to accelerate modestly from 4.2% in 2025 to 4.4% in 2027, driven by services and supported by agriculture and the non-oil industry.

Inflation is expected to gradually ease but remain elevated, requiring sustained monetary discipline and structural reforms to tackle food prices, the “biggest tax on the poor,” said Samer Matta, the World Bank’s Senior Economist for Nigeria.

World Bank has projected that Nigeria’s public debt is expected to decline for the first time in over a decade from 42.9 to 39.8% of Gross Domestic Product (GDP)

The World Bank said, “The country’s external position has strengthened.

According to the NDU, Nigeria’s economy expanded by 3.9% year-on-year in the first half of 2025, up from 3.5% in the same period of 2024.

The Nigerian government has taken bold steps to stabilize the economy, and these efforts are beginning to yield results.

TimeManager:
If the current Administration could achieve this in two/ two & half years, from a negative outlook to a positive one, I definitely believe all other parameters especially on the fiscal side would also be fixed. God bless Nigeria.

-Kiss the truth!

helinues:
Very good. Nigeria's economy future is promising

We are finished people should please stay out of this thread. This is not a sad news

Elvis2kay:
When some people hear a positive report about Nigeria economy they feel SAD. why?? Kudos to president Tinubu.

Parydelegate:
They will borrow more to increase it.

Even if it drops what's the impact on common man?

zero8zero:
Okonjo Iweala, Sanusi Lamido, Femi Adeshina, Charles Soludo and other seasoned economists confirmed the fact that Nigeria's economy is stable. Not some ignorant election losers, especially "the finishing specialist" and his sore followers who had zero understanding on macro and micro economics.
We are steadily recording increase in non oil revenue, GDP growth at 4.2%, stock market highest ever gains, trade surplus, we moved from being an oil import nation to oil export nation, there's steady increase in oil production with OPEC quota benchmark, our debt to revenue reduced to below 50%, debt to GDP projected to reduce further to around 39%. Couple of months back, we paid fully our IMF debts. Our credit ratings have improved everywhere from a negative to a positive within two years. All of these are as a result of a carefully thought out policy reforms. These are clear signs of stability, however, we need to translate these gains down the ladder, to spread developments to the grassroots which is where everyone agreed. But first, without growth, without the gains above, there can't be development.
The issue of food inflation is the biggest elephant in the room and this is mostly a human made factor, Banditry that is bedevilling farmers from going to farms and mass producing is largely a man made factor, it has nothing to do with Govt policy. Buhari tried anchors borrowers to assist farmers but it ended up being a flog, local farmers became more greedy rather than solve the problem of hunger. The current administration has learnt not to follow same old failed route but to import some food to help crash food prices. The President has also approved the creation of forest guards in the meantime, but a state police would provide a lasting solution.
Again, this is a big indictment on the Southern region, if you could still depend on the north for food despite being plagued by banditry, it therefore means, the South is not only mentally lazy but productively lazy. St this crucial point, the south should be coming to the rescue, engage in large scale mechanized farming in all the 17 states and feed the region. The south is even supposed to transport food to the northerners to be able to eat while they're unable go to farms. Why can't the South return the favor?. Unfortunately, the lazy south still depending on trucks of foods coming down south from a plagued north on daily basis, what a shame. All your Governors are sitting on fat allocations doing nothing. The Governors are in charge of lands in their states but are paying no attention to farming. How many youth empowerment programs are they bringing to the people in each local government?, how many traders empowerment in each local government?.

opes:
Ghanaian farmers are complaining that whenever farm produce from Nigeria arrives in their country, it usually saturates the market and causes a drop in local prices. Meanwhile, in Nigeria, the same goods are scarce and expensive.

zero8zero:
Okonjo Iweala, Sanusi Lamido, Femi Adeshina, Charles Soludo and other seasoned economists confirmed the fact that Nigeria's economy is stable. Not some ignorant election losers, especially "the finishing specialist" and his sore followers who had zero understanding on macro and micro economics.
We are steadily recording increase in non oil revenue, GDP growth at 4.2%, stock market highest ever gains, trade surplus, we moved from being an oil import nation to oil export nation, there's steady increase in oil production with OPEC quota benchmark, our debt to revenue reduced to below 50%, debt to GDP projected to reduce further to around 39%. Couple of months back, we paid fully our IMF debts. Our credit ratings have improved everywhere from a negative to a positive within two years. All of these are as a result of a carefully thought out policy reforms. These are clear signs of stability, however, we need to translate these gains down the ladder, to spread developments to the grassroots which is where everyone agreed. But first, without growth, without the gains above, there can't be development.
The issue of food inflation is the biggest elephant in the room and this is mostly a human made factor, Banditry that is bedevilling farmers from going to farms and mass producing is largely a man made factor, it has nothing to do with Govt policy. Buhari tried anchors borrowers to assist farmers but it ended up being a flog, local farmers became more greedy rather than solve the problem of hunger. The current administration has learnt not to follow same old failed route but to import some food to help crash food prices. The President has also approved the creation of forest guards in the meantime, but a state police would provide a lasting solution.
Again, this is a big indictment on the Southern region, if you could still depend on the north for food despite being plagued by banditry, it therefore means, the South is not only mentally lazy but productively lazy. St this crucial point, the south should be coming to the rescue, engage in large scale mechanized farming in all the 17 states and feed the region. The south is even supposed to transport food to the northerners to be able to eat while they're unable go to farms. Why can't the South return the favor?. Unfortunately, the lazy south still depending on trucks of foods coming down south from a plagued north on daily basis, what a shame. All your Governors are sitting on fat allocations doing nothing. The Governors are in charge of lands in their states but are paying no attention to farming. How many youth empowerment programs are they bringing to the people in each local government?, how many traders empowerment in each local government?.

Parydelegate:
They will borrow more to increase it.

Even if it drops what's the impact on common man?

helinues:
Very good. Nigeria's economy future is promising

We are finished people should please stay out of this thread. This is not a sad news