Nigeria’s economy is projected to grow at a slightly slower pace than earlier anticipated, but underlying improvements in macroeconomic stability and easing inflation suggest a cautiously optimistic outlook.
In its April 2026 Africa Economic Update titled “Making Industrial Policy Work in Africa,” the World Bank revised the country’s growth forecast to 4.1 percent for 2026, down from 4.4 percent projected in October 2025. Growth is expected to edge up gradually to 4.2 percent in 2027 and 4.3 percent in 2028.
Despite the downgrade, the institution emphasized that Nigeria’s economy is on a recovery path.
“Nigeria’s growth outlook is supported by more stable macroeconomic conditions and a gradual recovery in investment,” the report stated.
The services sector is expected to remain the backbone of expansion, with ICT, financial services, and real estate leading the way. Meanwhile, agriculture and industry are likely to face slower growth due to ongoing structural challenges.
Inflation, which surged to around 23 percent in 2025, is projected to decline significantly in the coming years. The World Bank forecasts it will drop to 14.9 percent in 2026 and further to 10.7 percent by 2028, driven by tighter policies and improved supply conditions.
“Improved inflation control, stronger currencies, and easing food and fuel prices have supported private consumption and investment,” the report noted.
Higher oil prices could also provide a boost to government revenues, offering some fiscal relief. However, the World Bank cautioned that several risks could weigh on the outlook, including global economic uncertainty, security concerns, and domestic political dynamics ahead of the 2027 elections.
“Global tensions, especially conflicts in the Middle East, could push up energy prices, disrupt trade, and trigger fresh inflation pressures,” it warned.
The report also highlighted that Nigeria’s revised forecast reflects a broader regional trend, with about 60 percent of sub-Saharan African countries experiencing downward revisions to their 2026 growth projections.
Even so, the overall outlook suggests that while challenges remain, Nigeria’s economy is gradually stabilizing, supported by reforms and resilience in key sectors.