The International Monetary Fund (IMF) has warned that rising prices of essential goods will worsen poverty and food insecurity in Nigeria, despite improvements in the country’s macroeconomic stability.
In its July 2026 World Economic Outlook (WEO) Update, the IMF retained Nigeria’s economic growth projections at 4.1 per cent for 2026 and 4.3 per cent for 2027. However, it cautioned that higher living costs would continue to weigh heavily on households.
According to the Fund, Nigeria’s recent macroeconomic reforms and favourable terms of trade have strengthened economic stability, but the benefits are being undermined by the rising cost of basic necessities.
“Growth in sub-Saharan Africa is expected to remain broadly stable at 4.3 per cent in 2026, though this masks substantial divergence across countries, reflecting differences in policy space, reform implementation and exposure to external shocks,” the report stated.
The IMF noted that oil-importing, non-resource-intensive economies are bearing the brunt of higher energy and food prices, while some larger economies have benefited from earlier stabilisation and reform efforts. It added that many countries in the region remain largely excluded from the artificial intelligence-driven global technology boom and continue to face challenges from declining official development assistance.
On Nigeria, the report said, “Nigeria is supported by improved macroeconomic stability and favourable terms-of-trade effects, though higher prices for essentials are expected to further aggravate poverty and food insecurity.”
The IMF projects Nigeria’s economy to grow by 4.1 per cent in 2026 and 4.3 per cent in 2027, while Sub-Saharan Africa is forecast to expand by 4.3 per cent and 4.5 per cent over the same period.
Globally, the Fund revised its growth forecast downward, projecting the world economy to grow by 3.0 per cent in 2026 and 3.4 per cent in 2027, compared with the average growth of 3.5 per cent recorded in 2024 and 2025.
“The modest slowdown reflects the effects of the war in the Middle East being partly offset by accelerated demand-driven momentum in the global technology cycle driven by advances in artificial intelligence and its adoption,” the IMF said.
The report also warned that global inflation is expected to rise from 4.1 per cent in 2025 to 4.7 per cent in 2026 before easing to 3.9 per cent in 2027, signalling that the earlier trend of slowing inflation has stalled.
Looking ahead, the IMF identified renewed conflict in the Middle East as a major risk to the global outlook, warning that it could fuel commodity price volatility, disrupt supply chains, increase inflationary pressures and tighten financial conditions.
It also cautioned that growing trade fragmentation could weaken global output and drive prices higher, urging governments to restore price stability, rebuild fiscal buffers and accelerate structural reforms to strengthen energy security, improve readiness for artificial intelligence and deepen international cooperation.
