The growth rate increased from 3.9% during the corresponding period in 2025 and 3.5% in 2024, according to the latest World Bank Nigeria Development Update.
Services drove much of the expansion, while agriculture made a stronger contribution. The World Bank said the acceleration helped stabilise Nigeria’s poverty rate for the first time since 2019.
The Middle East conflict produced mixed economic effects. Higher oil prices increased export earnings and widened the current-account surplus to $12 billion, equivalent to 7.1% of gross domestic product, during the first half of 2026.
The surplus stood at $8.6 billion, or 6.7% of gross domestic product, a year earlier.
Oil earnings also increased government revenue, although forward sales and oil-backed financing arrangements limited the gains.
Foreign-exchange reserves exceeded $54 billion in September, supported largely by foreign portfolio investment. Reforms also improved the functioning of the foreign-exchange market.
However, higher fuel and food prices slowed progress in reducing inflation.
Headline inflation declined from 27.6% in January 2025 to 15.2% in December 2025, supported by tight monetary policy and reduced exchange-rate volatility. Inflation nevertheless remains elevated and continues to weaken household purchasing power.
The report found that gross federation revenue increased by 69% in real terms between 2023 and 2025, largely because of exchange-rate reforms, petrol-subsidy removal and stronger revenue administration.
State revenue increased by about 93% in real terms, while expenditure rose by 92%.
Capital spending’s share of total state expenditure increased from 46% to 61%, led by transport, housing and agriculture.
Social spending rose more slowly. Education’s share declined from 14.9% in 2021 to 12.1% in 2025, while healthcare remained at about 7%. Social protection increased from 1.4% to 4.4%. “The bold macroeconomic reforms have substantially increased fiscal revenues at the state level, providing a unique opportunity to improve infrastructure, education, healthcare and water services,” World Bank Country Director for Nigeria Mathew Verghis said.
Nigeria’s economy is projected to grow by an average of 4.4% between 2026 and 2028, while inflation could decline to about 12% by 2028.
–WorldBank/ChannelAfrica–
