The World Bank has downgraded Nigeria’s economic growth projection to an average of 4.1 percent in 2026, down from its earlier estimate of 4.4 percent.
In October 2025, the global lender had projected that Nigeria’s economy would grow by 4.4 percent in both 2026 and 2027. However, the 2027 forecast has now been revised downward to 4.2 percent, while growth for 2028 is projected at 4.3 percent.
In its April 2026 Africa Economic Update titled Making Industrial Policy Work in Africa, released on Wednesday, the bank said the revised outlook reflects more stable macroeconomic conditions and a gradual recovery in investment.
The institution noted that the services sector — particularly ICT, finance, and real estate — will remain the primary driver of growth, while agriculture and industry are expected to expand more slowly due to structural constraints.
The World Bank also projected that inflation will decline from 23 percent in 2025 to 14.9 percent in 2026, before easing further to 10.7 percent by 2028, driven by the delayed effects of policy tightening and improved 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 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 said economic activity in sub-Saharan Africa is projected to grow by 4.1 percent in 2026, unchanged from 2025, but noted that the regional outlook has been downgraded by 0.3 percentage points compared to its October 2025 projection.
“Across countries in the region, some large countries in the region have been revised downward in 2026; notably, Angola, Kenya, Mozambique, Nigeria, Senegal, South Africa, and Zambia,” the report stated.
“Overall, about 60 percent of the countries in the region (29 of 47) recorded downward revisions to their 2026 growth forecasts.”
Despite the downgrade, the bank said regional economic activity continues to benefit from improved macroeconomic stabilisation, including better inflation control, stronger domestic currencies, and easing fuel and food prices.
“These developments have helped bolster private consumption and investment, while enhanced policy frameworks are strengthening credibility and resilience,” it added.
The lender also said higher commodity prices, particularly precious metals and beverages, have supported export earnings and government revenues, while trade has remained resilient despite ongoing global tensions.
However, it warned that gains could be undermined by rising external risks, especially the escalating conflict in the Middle East, which may trigger higher energy prices, disrupt trade, and renew inflationary pressures.
From the expenditure side, the report said growth in 2026 will be largely driven by private consumption and investment. Household consumption is projected to contribute 1.6 percentage points to GDP growth, down from 1.8 percent in 2025, while investment is expected to contribute 1.0 percent, up from 0.9 percent.
On the production side, the services sector is forecast to account for about half of total growth, led by finance, ICT, wholesale and retail trade, and tourism.
Faridah Abdulkadiri
