Nigeria’s economy showed significant improvement in the last quarter of 2024, posting its highest growth in a decade.
This was driven by a strengthened fiscal position and an enhanced foreign exchange market.
Revealed in the World Bank’s Nigeria Development Update, titled “Building Momentum for Inclusive Growth,” on Monday, the report noted that Nigeria’s growth surged to 4.6% year-on-year, bringing the nation’s growth for 2024 to 3.4%, the highest since 2014.
The fiscal deficit reduced from 5.4% of GDP in 2023 to 3.0% of GDP in 2024, a result of a significant rise in national revenue, which increased from N16.8 trillion in 2023 to N31.9 trillion in 2024.
Despite these positive developments, the report pointed out that inflation remains high but is expected to decrease to an average of 22.1% in 2025, driven by ongoing reforms.
Taimur Samad, acting World Bank country director for Nigeria, commented on the progress:
“Nigeria has made impressive strides in restoring macroeconomic stability. With improvements in the fiscal position, Nigeria now has a historic opportunity to enhance development spending, focusing more on human capital, social protection, and infrastructure. The allocation of public resources can begin to shift away from past unsustainable practices and instead address Nigeria’s large development needs, with the government playing a crucial role in providing basic public services and enabling private sector-led growth.”
The report emphasizes the importance of rebalancing the country’s focus towards sectors and firms that are most productive, generate positive spillovers, and create job opportunities to help achieve the government’s goal of a $1 trillion economy by 2030.
Although the report highlighted the finance and ICT sectors among the most productive, it also noted the limited job opportunities challenging the sector.
Calls for addressing the infrastructure deficit in electricity and transportation were made, in order to foster healthy competition, and improve access to finance through a private-sector-led, public-sector-facilitated growth strategy to sustain progress.
