IMF upgrades Nigeria’s 2026 growth forecast to 4.4% as reform gains take hold

By: Chidozie Nwali

The International Monetary Fund (IMF) on Monday officially revised its 2026 Gross Domestic Product (GDP) growth projection for Africa’s most populous nation upward to 4.4% from 4.2%.

The updated forecast, released in the IMF’s 2026 World Economic Outlook update, marks a significant departure from the sluggish growth rates seen over the last decade. This latest IMF revision aligns with the World Bank and the Central Bank of Nigeria (CBN), both of which recently issued similarly optimistic forecasts ranging from 4.4% to 4.5%.

IMF analysts attribute the upgrade to a “synergy of aggressive domestic reforms and a stabilizing global environment.” According to the report, three primary pillars are supporting this accelerated growth:

•  Energy Sector Revolution: The full-scale operation of the Dangote Refinery and other modular refineries has transitioned Nigeria from a net importer to a net exporter of refined petroleum products. This shift has significantly reduced the demand for foreign exchange and bolstered the nation’s trade balance.
•  Non-Oil Sector Resilience: The services sector—specifically ICT, financial services, and creative industries—continues to be the primary engine of growth. Additionally, a projected rebound in agricultural output, supported by improved security in food-producing regions, is expected to add 0.8 percentage points to the overall GDP.
• Macroeconomic Stability: The IMF noted that the “painful but necessary” reforms of 2023–2024, including the unification of the exchange rate, removal of costly fuel subsidies and tax system overhauls, are finally yielding results. Foreign Direct Investment (FDI) is beginning to return as currency volatility eases.

If realized, a 4.4% growth rate would be Nigeria’s strongest economic performance since 2014. For comparison, the global economy is projected to grow at a slower pace of 3.3% in 2026. This puts Nigeria in the “high-performer” bracket for Sub-Saharan Africa, trailing only behind the regional average of 4.6%.

The Fund projected a 1.4% GDP growth for South Africa, Africa’s largest economy.

Despite the 4.4% GDP expansion, inflation is still projected to hover around 22% in early 2026.

The IMF’s upgrade signals a “developmental inflection point” for Nigeria. With the economy expected to reach a nominal GDP of approximately $334 billion by the end of 2026, Nigeria is on track to reclaim its position among Africa’s top three (South Africa, Egypt) largest economies.