In what can be regarded as unusual verdict, World Bank has disclosed that Nigeria’s economy recorded its fastest growth in about a decade in 2024, driven by a strong fourth quarter and an improved fiscal position, but warned that persistently high inflation remains a challenge.
The Reuters also reports that bold reforms implemented by President Bola Tinubu, including ending costly petrol subsidies, slashing electricity allowances and twice devaluing the naira currency, have added to upward pressure on prices.
The World Bank’s lead economist for Nigeria, Alex Sienaert, gave the verdict on Monday during a presentation in Abuja, saying that the Nigerian economy grew by 4.6% year-on-year in the fourth quarter of 2024 and pointed to remarkable expansion in early 2025 based on high-frequency business indicators.
According to him, the World Bank expects Nigeria’s economy to grow 3.6% this year.
Sienaert also stated Nigeria’s foreign exchange reforms have created a market-reflective, unified and stable exchange rate, allowing the central bank to rebuild official reserves, now exceeding $37 billion.
He said, That’s significant because this is the cushion the economy has against external volatility.”
Sienaert said government revenue rose by 4.5% of GDP last year, saying that the the development represents a “remarkable achievement” driven by the removal of foreign exchange subsidies, improved tax administration and higher remittances.
The higher revenue helped cut the fiscal deficit to an estimated 3% of GDP in 2024, from 5.4% in 2023.
He however said that the full revenue gain from the removal of the fuel subsidy is also yet to fully materialise, Sienaert said.
As Nigeria continues to grapple with high inflation, Sienaert cautioned that tight monetary policy and disciplined fiscal policy must be sustained.
