IMF downgrades Nigeria’s 2026 growth forecast to 4.1%

The International Monetary Fund has downgraded Nigeria’s 2026 growth forecast to 4.1 per cent, citing economic disruptions linked to the ongoing Middle East conflict and its impact on global energy markets.

The revision was disclosed in the Fund’s April 2026 Global Financial Stability Report, as sighted on its website on Tuesday.

This latest outlook is slightly lower than the 4.4% projection made in January 2026, though it remains slightly higher than the forecast released in October 2025.

IMF forecasts 4.4% growth for Nigeria, flags inflation

“In Nigeria, growth momentum is sustained at 4.1 percent in 2026, supported by improved macroeconomic stability and positive terms-of-trade effects, while higher goods and transport costs are headwinds. Growth is expected to strengthen in 2027 to 4.3 percent as these headwinds ease,” the report said.

Speaking during the release of the report at the IMF and World Bank Spring Meetings in Washington, D.C, officials warned that war-related energy price increases and supply chain shocks are slowing recovery across several regions.

The fund’s Chief Economist, Pierre-Olivier Gourinchas, said the downgrade reflects wider pressures affecting energy-importing economies.

“On Sub-Saharan Africa, we are seeing some downgrade of growth, and we are seeing some uptick in inflation in a number of countries in the region,” Gourinchas said.

“The impact is very much along the lines of what we see more broadly — for a lot of the countries, especially the ones that are energy importers.”

He added that the Fund is monitoring developments closely and engaging with affected countries to assess emerging needs.

“We are following with a number of countries what their needs may be in the current environment,” he said, noting coordination with the International Energy Agency and the World Bank on energy market disruptions.

Speaking further, the Chief of the IMF Research Department’s World Economic Studies Division, Denz Igan, said the 0.3 percentage point downgrade reflects mixed pressures on Nigeria’s economy.

“War-related higher fuel and fertilizer prices and higher shipping costs are going to weigh on non-oil activity in Nigeria.

“There’s some offset coming from higher oil prices, but the net balance is weaker growth in 2026, with some recovery built in for 2027,” Igan said.

The Fund projects that median inflation in Sub-Saharan Africa will rise from 3.4 per cent in 2025 to 5 per cent in 2026, driven by higher energy and fertilizer prices, possible fuel shortages, and rising logistics costs.

It added that tight monetary policy will be “crucial to achieve the inflation target of the central bank” in Nigeria.

The IMF also noted that bilateral aid to Sub-Saharan Africa fell by 16 to 20 per cent in 2025, reducing fiscal buffers at a time of rising commodity and shipping costs.