The World Bank has revised down its projection for Nigeria’s economic growth in 2026, estimating an average expansion of 4.1 per cent, lower than its earlier forecast of 4.4 per cent.
The global lender also trimmed the outlook for 2027 to 4.2 percent, while projecting growth for 2028 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 relatively stable macroeconomic conditions alongside a gradual recovery in investment across the country.
According to the report, the services sector particularly information and communications technology (ICT), finance, and real estate, will remain the principal driver of growth.
In contrast, agriculture and industry are expected to expand more slowly due to structural constraints.
The World Bank also projected that inflation would fall from 23 per cent in 2025 to 14.9 per cent in 2026 and further ease to 10.7 per cent by 2028.
This moderation is expected to result from delayed policy tightening effects 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.
It added that rising oil prices could support fiscal and external balances but may be partly offset by capital flow volatility amid global uncertainty.
The bank cautioned that business sentiment and reform momentum could be dampened by commodity price fluctuations, tighter global financial conditions, security concerns, and policy uncertainty ahead of the 2027 elections.
On a regional level, economic activity in sub-Saharan Africa is projected to grow by 4.1 per cent in 2026, unchanged from 2025.
However, the regional outlook has been downgraded by 0.3 percentage points compared to the World Bank’s October 2025 forecast.
“Across countries in the region, several large economies have been revised downward in 2026, notably Angola, Kenya, Mozambique, Nigeria, Senegal, South Africa, and Zambia,” the report stated.
“Overall, about 60 per cent of the countries in the region (29 of 47) recorded downward revisions to their 2026 growth forecasts.”
Despite the downgrades, the bank noted that 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,” the report added.
The lender further highlighted that higher commodity prices, particularly for precious metals and beverages, have supported export earnings and government revenues.
Trade has remained resilient despite ongoing global tensions, although gains could be threatened by rising external risks such as the escalating conflict in the Middle East, which may drive up energy prices, disrupt trade, and revive inflationary pressures.
From an expenditure perspective, 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 per cent in 2025, while investment is expected to contribute 1.0 per cent, 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.
