By James Adamu
The International Monetary Fund has raised concerns that the rising cost of essential goods could deepen poverty and food insecurity in Nigeria, even as the country records gains in macroeconomic stability and external trade.
In its October 2026 World Economic Outlook report, titled “Resilience Under Strain, Urgent Choices”, the Fund noted a widening gap between improving economic indicators and the actual living conditions of vulnerable Nigerians.
According to the IMF, Nigeria’s economy is being buoyed by greater macroeconomic stability and favourable terms of trade, but the escalating prices of basic necessities threaten to push more households into hardship.
“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 report stated.
The Fund’s assessment suggests that while recent stabilisation measures have strengthened Nigeria’s economic outlook, they have not yet eased the burden on households grappling with the soaring cost of food and other essentials.
Nigeria is listed among the larger sub-Saharan African economies benefiting from earlier reforms and stabilisation efforts, even as the region remains vulnerable to commodity price swings, climate shocks and constrained access to external financing.
The report projected that growth in sub-Saharan Africa would hold steady at 4.5 per cent in 2026, noting that the figure conceals significant differences in policy implementation, fiscal capacity and exposure to global disruptions across countries.
“Growth in sub-Saharan Africa is expected to remain stable at 4.5 percent in 2026, though this masks some substantial divergence across countries,” the IMF stated.
It explained that oil-importing and non-resource-intensive economies were under heavier pressure from rising energy and food costs, while some larger economies were drawing strength from earlier reforms.
For Nigeria, the IMF projected economic expansion of 4.2 per cent in 2026, up from an estimated 4.0 per cent in 2025, before rising to 4.3 per cent in 2027.
The 2026 forecast was revised upward by 0.1 percentage point from the Fund’s April projection, with the 2027 estimate also raised by the same margin.
The projections point to a stronger external position in 2026, though the anticipated decline in the surplus next year signals a moderation in external balances.
The IMF, however, cautioned that stronger macroeconomic fundamentals do not automatically translate into better household welfare, particularly when essential commodity prices keep climbing.
It also flagged declining official development assistance and Africa’s limited participation in the global artificial intelligence investment boom as key challenges for several economies on the continent.
The Fund warned that persistent geopolitical tensions, elevated food and energy prices and tighter global financing conditions could stifle growth, especially in developing nations.
“Risks are skewed to the downside,” the IMF stated, singling out a prolonged Middle East conflict and further disruptions to energy infrastructure as potential threats to global economic stability.
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