Nigeria’s economy has recorded its fastest growth in nearly ten years, according to the World Bank. This was driven by strong economic activity in the last quarter of 2024 and better government revenue. The World Bank’s lead economist for Nigeria, Alex Sienaert, said the economy grew by 4.6% year-on-year in Q4 2024. He added that business indicators suggest the economy has continued to grow in early 2025.
Despite this growth, Sienaert warned that high inflation remains a big problem. “Tight monetary policy and disciplined fiscal policy must be sustained,” he said.
Economic reforms boost Nigeria’s growth
The strong performance follows reforms by President Bola Tinubu’s government. These include the removal of petrol subsidies, reduction in electricity subsidies, and the devaluation of the naira. These actions have improved government finances but pushed up prices.
Nigeria’s inflation rate fell to 23.18% in February 2025, its lowest since June 2023. Food inflation also dropped to 23.51%, the lowest since September 2022. However, core inflation — which leaves out food and energy — rose to 24.43%, up from 23.01% in January. On a monthly basis, prices went up by 3.90% in March, higher than the 2.04% rise in February.
Foreign exchange reforms help reserve growth
According to Sienaert, Nigeria’s foreign exchange reforms have created a stable and market-reflective rate. This has helped the Central Bank of Nigeria rebuild its reserves, now over $37 billion. “That’s significant because this is the cushion the economy has against external volatility,” he said.
Government revenue rises, but challenges remain
Sienaert noted that government revenue increased by 4.5% of GDP in 2024, thanks to better tax administration, the end of forex subsidies, and higher remittances. As a result, the fiscal deficit shrank to 3% of GDP, down from 5.4% in 2023.
However, the economist said the full gains from fuel subsidy removal are yet to be realised. He stressed that inflation remains a big threat and urged the government to stay focused.
Even with this growth, many Nigerians still face hardship due to rising prices, unemployment, and daily struggles. Life remains tough for the average citizen, despite the fastest growth in a decade.
Nigeria economy records fastest growth in a decade
The World Bank’s new data shows clear economic growth, but also points to continuing challenges. While Nigeria’s economy records fastest growth in a decade, inflation and hardship still affect ordinary Nigerians. The government must stay consistent with reforms to make sure this growth benefits everyone.
