The World Bank has reduced Nigeria’s economic growth projection for 2026 to 4.1 percent, down from the 4.4 percent forecast it made in October 2025.
The lender also lowered Nigeria’s 2027 forecast to 4.2 percent, while projecting growth of 4.3 percent in 2028.
In its April 2026 Africa Economic Update titled “Making Industrial Policy Work in Africa,” released on Wednesday, the World Bank said Nigeria’s outlook is supported by improving macroeconomic stability and a gradual recovery in investment.
According to the report, the services sector — especially ICT, finance, and real estate — will continue to drive growth, while agriculture and industry are expected to expand at a slower pace due to structural challenges.
The bank also projected that inflation in Nigeria will fall from 23 percent in 2025 to 14.9 percent in 2026, before easing further to 10.7 percent by 2028, reflecting the delayed effects of tighter policies and improving supply conditions.
“Although poverty remains elevated, it is expected to decline gradually as inflation eases, albeit more slowly due to higher fuel prices linked to the Middle East conflict,” the World Bank said.
“Rising oil prices could support fiscal and external balances, partly offset by capital flow volatility amid global uncertainty.
“However, business sentiment and reform momentum may be dampened by commodity price by commodity price volatility, tighter global financial conditions, security concerns, and policy uncertainty ahead of the 2027 elections.”
The World Bank also said sub-Saharan Africa’s economy is expected to grow by 4.1 percent in 2026, unchanged from 2025, though this marks a downward revision of 0.3 percentage points from its October 2025 estimate.
It noted that several major African economies, including Nigeria, Angola, Kenya, Mozambique, Senegal, South Africa, and Zambia, had their 2026 projections revised downward.
“Overall, about 60 percent of the countries in the region (29 of 47) recorded downward revisions to their 2026 growth forecasts,” the report stated.
Despite the downgrades, the World Bank said the region has benefited from better inflation control, stronger local currencies, and easing food and fuel prices, which have helped support private consumption and investment.
The institution warned, however, that rising external risks — especially the worsening Middle East conflict — could push up energy prices, disrupt trade, and reignite inflation pressures.
On the expenditure side, the bank said private consumption and investment will remain the main drivers of growth in 2026, while on the production side, services are expected to contribute about half of total economic expansion, led by finance, ICT, trade, and tourism.