IMF: Nigeria to outpace US, UK, Germany in growth by 2027

NIGERIA’S economy is projected to expand at a faster pace than several major advanced economies by 2027, according to new forecasts from the International Monetary Fund (IMF), which puts the country’s growth rate at 4.3 percent.

The outlook signals a gradual recovery following a downward revision for 2026, where growth is now expected at 4.1 percent, slightly below earlier projections, and an estimated 4 percent in 2025.

Details of the projection were unveiled in the IMF’s latest World Economic Outlook (WEO), presented during a media briefing at the ongoing IMF-World Bank Spring Meetings in Washington, DC, the United States.

At the projected 4.3 percent growth rate in 2027, Nigeria is expected to outpace a group of 8 advanced economies. These include the United States (2.1 percent), Canada (1.9 percent), Spain (1.8 percent), the United Kingdom (1.3 percent), Germany (1.2 percent), France (0.9 percent), Japan (0.6 percent), and Italy (0.5 percent).

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Despite the stronger growth rate, the IMF clarified that this does not translate into Nigeria having a larger economy than those countries, given their significantly higher economic base.

Explaining the recent downgrade, a division chief in the IMF’s Research Department, Ms Deniz Igan, said Nigeria’s outlook reflects competing pressures. She noted that rising fuel and fertiliser prices, alongside higher shipping costs linked to ongoing global tensions, are expected to weigh on oil sector performance.

Although elevated oil prices may provide some support, the overall balance remains negative for 2026, with a recovery anticipated in the following year.

On monetary policy, Nigeria’s central bank is targeting a reduction in inflation to between 6 and 9 percent over the medium term as it moves toward an inflation-targeting framework.

Igan emphasised that achieving this goal would depend on maintaining a tight, data-driven monetary stance, with close attention to exchange rate movements and inflation expectations.

Globally, the IMF expects growth to moderate, projecting expansion of 3.1 percent in 2026 and 3.2 percent in 2027, compared to about 3.4 percent recorded in 2024 and 2025.

The 2026 forecast was revised downward by 0.2 percentage points, largely due to disruptions stemming from the Middle East conflict. The IMF noted that without the conflict, global growth would have been slightly stronger.

Inflation at the global level is also expected to rise to 4.4 percent in 2026 before easing to 3.7 percent in 2027, reflecting upward revisions for both years.

For sub-Saharan Africa, the IMF said the region is facing mounting challenges despite a relatively strong performance in 2025. Prior to the escalation of global tensions, growth prospects had been supported by resilient global conditions, strong non-oil commodity prices, and favourable financing environments.

However, the conflict has weakened these conditions, leading to softer commodity prices and worsening terms of trade, particularly for oil-importing countries in the region.

Additionally, declining foreign aid remains a significant headwind, with bilateral assistance expected to fall between 16 and 28 percent in 2025, a trend projected to persist.

The IMF estimates that growth in sub-Saharan Africa will be reduced by a cumulative 0.4 percentage points across 2026 and 2027, while median inflation is expected to rise from 3.4 percent in 2025 to 5 percent in 2026.

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Rising fertiliser costs and environmental pressures also pose risks, particularly given the region’s reliance on agriculture and existing food security concerns.

IMF Chief Economist,Mr Pierre-Olivier Gourinchas, said the fund is actively engaging with countries to assess their needs and provide necessary support amid the evolving global environment.

He added that the IMF is working closely with institutions such as the World Bank and the International Energy Agency (IEA), while calling for a swift resolution to the Middle East conflict to stabilise global energy markets.