Africa Moves Ahead: How Nigeria Fell Off The IMF’s Fastest-Growing Economies List
By ANDERSON (ANDY) CLIFF
ONCE hailed as Africa’s economic giant, Nigeria is again absent from the International Monetary Fund’s (IMF) latest ranking of the continent’s fastest-growing economies — a symbolic and sobering reminder of how far the nation has drifted from its promise of economic leadership.
In its recently released Regional Economic Outlook, the IMF spotlighted Benin Republic, Côte d’Ivoire, Ethiopia, Rwanda, and Uganda as Africa’s top-performing economies. These countries, the Fund said, have managed to sustain robust GDP growth through “macroeconomic stabilization and reform efforts,” with consistent policies in agriculture, manufacturing, and infrastructure attracting foreign investments even amid global economic headwinds.
Nigeria’s Absence and the Question of Growth
Nigeria, despite being the continent’s most populous country and largest economy by size, failed to make the cut. The IMF’s assessment underscores a reality long whispered among economists — that Africa’s biggest market is no longer one of its most dynamic.
While the IMF marginally revised Nigeria’s growth projection upward to 3.9% in 2025, citing increased oil production, improved investor confidence, and a more supportive fiscal environment, it also cautioned that the country’s economic growth “remains below potential.”
Data from Nigeria’s National Bureau of Statistics (NBS) paints a mixed picture: GDP expanded by 4.23% in Q2 2025, up from 3.48% a year earlier, driven by higher crude output and modest recovery in the non-oil sector. Yet, this growth pales in comparison to Rwanda’s near double-digit surge or Côte d’Ivoire’s strong performance powered by diversified exports and manufacturing reform.
What Other African Nations Are Doing Right
Across Africa, smaller economies are showing that size isn’t everything — discipline and policy coherence are. The IMF attributes the rapid expansion in countries like Benin and Uganda to fiscal reforms, investment in infrastructure, and efforts to modernize agriculture through technology.
Rwanda, often cited as a model of reform, continues to channel investment into education, digital transformation, and governance — yielding sustained productivity growth. Ethiopia, despite internal challenges, has also managed to attract investment into renewable energy and manufacturing hubs.
These nations share a common thread: long-term planning and policy consistency. Nigeria, by contrast, continues to wrestle with structural inefficiencies — erratic policy shifts, insecurity in food-producing regions, unreliable power supply, and rising inflation that keeps eroding consumer purchasing power.
The IMF’s Warnings and Lessons for Nigeria
In its outlook, the IMF warned that many African governments, including Nigeria, face growing financial vulnerabilities due to overreliance on domestic bank borrowing to finance public spending. Roughly half of Sub-Saharan Africa’s public debt, the Fund noted, is now held by local banks — a trend that risks creating dangerous interdependence between governments and financial institutions.
The Fund urged African nations to focus on two critical policy areas: domestic revenue mobilisation and debt transparency. It called for modernized tax systems, digitalisation of revenue collection, and the reduction of inefficient tax waivers that deplete government coffers.
These recommendations mirror Nigeria’s own policy ambitions. In recent years, the Federal Government has made attempts at fiscal consolidation, currency unification, and monetary tightening. But experts argue that reforms have been uneven and slow to yield results.
What the IMF Thinks Nigeria Is Doing Right
Despite Nigeria’s exclusion from the “fastest-growing” list, IMF officials maintain a cautiously optimistic view. During the IMF/World Bank Annual Meetings, senior officials from the Fund’s Fiscal Affairs and Monetary and Capital Markets departments described Nigeria’s economic direction as “broadly positive.”
Davide Furceri, Division Chief at the IMF’s Fiscal Affairs Department, noted that the government has made strides in reducing excessive spending and simplifying the tax framework. “Nigeria’s fiscal stance is currently neutral — balancing expenditure and revenue to support monetary tightening,” he said.
Tobias Adrian, the IMF’s Director of Monetary and Capital Markets, added that Nigeria’s exchange rate flexibility and tighter monetary policy have begun to restore investor confidence. “A depreciating exchange rate isn’t necessarily bad,” he said. “It can help restore equilibrium. Nigeria’s policy calibration has been encouraging.”
Inflation, though still high, has declined from over 30% in 2024 to around 23% in 2025, according to IMF Assistant Director Jason Wu. Wu praised the country’s progress in foreign exchange transparency and improved revenue collection but warned that regional vulnerabilities — such as capital flow volatility and high debt levels — still pose serious risks.
The Road Ahead
Nigeria’s absence from the IMF’s ranking is not merely about statistics; it is a reflection of lost momentum. While smaller African economies surge ahead through reform and innovation, Nigeria’s challenge lies in translating its potential into sustainable progress.
The country’s sheer market size, youthful population, and abundant natural resources remain unmatched on the continent. But without tackling persistent structural weaknesses — from insecurity and policy inconsistency to infrastructural decay — Nigeria risks being outpaced by the very nations it once dwarfed economically.
For now, the IMF’s message is clear: Nigeria’s future growth depends not on its size or resources, but on discipline, reform, and the courage to stay the course.
