Economic experts have expressed mixed expectations over Nigeria’s economic outlook in 2026, warning that despite positive macroeconomic indicators, poverty levels may worsen, jobs remain scarce and small businesses continue to struggle under high costs, weak infrastructure and policy distortions.

Prof. Akpan Ekpo, Executive Chairman, Foundation for Economic Research and Training (FERT), explained that despite forecasts of economic growth, Nigerians should not expect any significant drop in poverty levels.

Ekpo noted that marginal economic gains would largely favour the elite, while the working class would continue to suffer despite government reforms.

He also cited Nigeria’s overdependence on oil, high cost of governance, weak manufacturing base, insecurity and poor infrastructure as major constraints.

According to him, small and medium enterprises (SMEs) would face another tough year due to limited access to credit, unreliable power supply and insecurity, stressing that these challenges continue to discourage productive investment.

“I think poverty will increase because the projected growth in GDP will not have any positive impact on poverty. The GDP will grow by 4.8 or 4.9 per cent. It will have no impact on poverty reduction. The GDP has to grow at least double digits, sustained for 15 years, to have any dent on poverty reduction.

“We need deliberate government policies that are implemented, not dependent on GDP growth. So, I do not see the economy for this year growing to a point it will reduce poverty.

“The exchange rate is relatively stable, at a very high rate. But the exchange rate should be less dependent on oil export. We should try and implement the policies of manufacturers so that we have a productive economy, where we produce and manufacture non-oil goods and export them to other things and are not dependent on the oil sector.

“You can see where the world is now. America has entered Venezuela and they are interested in their oil. If they have that oil and they pump it out, oil prices will drop and that will affect us,” Ekpo said.

He also pointed out that government costs are very high and real economic progress is limited, mostly benefiting elites, with little gain for the working class.

On small businesses, Ekpo said SMEs face many challenges, especially lack of access to credit despite government funds. He stressed that poor power supply forces businesses to run on generators, which is unsustainable, adding that insecurity will deter foreign investment if not addressed.

He further noted that major sectors like health and education are in disarray, and expressed doubts that this year will be different, and further raised questions on official inflation figures, saying they don’t match market realities.

Similarly, Femi Saibu, a professor of Economics at the University of Lagos (UNILAG), noted that Nigeria begins 2026 with cautious optimism, supported by stable foreign exchange, increasing oil production, and ongoing economic reforms.

He cautioned that poverty could worsen, job creation may stay sluggish, and inflation risks remain due to election-year spending, weak investment in the real sector, and rising costs.

Saibu added that while small businesses might benefit somewhat from forex stability, they would continue to face challenges such as limited access to credit, high energy expenses, and regulatory hurdles.

According to him, “Nigeria enters 2026 with cautious optimism. Economic growth is projected at around 4.5 percent, buoyed by foreign exchange stability, rising oil output, and ongoing structural reforms.

“Inflation is expected to moderate toward 13 percent, while external reserves may strengthen to over $51 billion. Poverty is set to deepen, with nearly 141 million people, about 62 percent of the population, living below the poverty line.

“Election year dynamics could reignite inflation, while credit tightening may hurt small businesses.

“Without policy credibility and consistent implementation, the optimism of 2026 risks becoming another missed opportunity.”

On his part, Economic and Development Expert, Dr. Aliyu Ilias, said Nigeria’s macroeconomic outlook for 2026 appears positive, but questioned how much of the gains would translate into improved welfare for ordinary Nigerians.

Ilias said poverty could reduce as reform effects begin to filter through the economy, but expressed concern that job creation may remain weak due to the dominance of the service sector.

He added that inflation could ease further if transportation and energy costs are addressed, while small businesses could benefit if interest rates and energy prices are reduced.

“If you look at the macro economy that we have now, it indicates that there is going to be positivity in the Nigerian economy. The question is, how will it translate to the benefit of most Nigerians?

“In terms of poverty, we expect poverty to be reduced because we are looking at the lag time that would have passed over that period.

“In terms of job creation, I find it difficult to see that, simply because our GDP service economy is taking the lead. What can bring job creation is investment in industry, the manufacturing sector, and agriculture, which is our mainstay.

“By the end of the year, if what we are doing is correct, we should be looking at single-digit inflation, especially if we can work on transportation and energy.

“Opening the border to import food is not a good idea because if you import, that means you are importing poverty.

“For small businesses, this should be our year if the government reduces interest rates and energy costs,” the expert stated.

Similarly, Ojo Joseph Ajanaku, National President, National Cashew Association of Nigeria (NCAN) has predicted a bumper season for farmers, claiming that the removal of the fuel subsidy by President Bola Tinubu nudged most people to go into agriculture which has led to food availability.

He said: “Because of the removal of fuel subsidies, many of our people went back to farming because they were not able to afford the buying of this commodity themselves from the market.

“And so, they decided to go back to the farm. Where they think that, if I farm myself, it will be cheaper for me. And, you know, it is not the day you plant that you harvest.

“Because many people have gone back to the farm, that is going to impact the market. Because there will be much production, and a lot of supply and demand will come into play.

“So, it is going to have an impact. That is, the inflation will drastically reduce in that angle. And, the other way is that, the government is trying to say that, they encourage people to do what will profit them directly.

“But I think the most important one that is going to be very impactful is that many people have gone back to the farm. And, that will impact the inflation rate.”

On job creation, he said: “The person that has gone back to farm has practically employed himself. So, you are no longer going to be having many people roaming about the street.”

He said for the government to achieve full scale job availability, it must encourage massive investment in agriculture and production.

“But what we are particular about, what we think the government should do is to encourage conscious investment in agriculture, in production.

“Conscious investment in agriculture to depopulate the urban area – let the rural area, where we have these arable lands, where we have this land, let them be empowered.

“By the time they are fully empowered, and by the time they are empowered, you will see that many of those people who are back in the city, doing nothing, will go back home to farm.”

He referenced the Anchor Borrowers Scheme, which he said failed because of how it was managed, hoping that the government can still do better in restructuring the initiative to favour farmers.

Ajanaku also made reference to the cashew value chain as a viable option for job creation in 2026. “Kano State today is not recorded among the cashew producing states in Nigeria, but we ran some experiments today. Some curious Nigerians who said we can plant cashew in our place, and they planted cashew in their place.

“They sent some to us. The product that they sent to us is better than the product that we have in other parts of Nigeria. We are having the highest nut count.

“170 nut count from Kano. And, do you know what our people do? Those foreigners, those Indians that are buying our cashew in Nigeria, they buy cashew from Kogi, and take to Kano to go and sun-dry. Because they say there is sun in Kano.

“Now in Kogi State, for instance, where we are, there is no single processing factory in that place. We have three single factory districts in Kogi State. If we set up a factory in Ida, if we set up a factory in Dekina, if we set up a factory in Lokoja, or set up a factory in Kabba.

Also, Kabir Ibrahim, President, Nigeria Agribusiness Group (NABG), pushed for the resuscitation of Good Manufacturing Practice (GMP) by the administration targeting the staples in the six geopolitical zones of the nation and intervening to bring down the prices of fertilizers and other inputs which he said might avert a food crisis in Nigeria from Mid 2026 to 2027 and beyond.

According to Ibrahim, it is necessary for the government to promptly determine fair prices of farm produce by having town hall meetings with small holder farmers, spray service providers and input producers and sellers as well as agribusiness experts. “The economy of production of the identified staples like maize, rice, Sorghum, cassava etc. can be arrived at and this should be used transparently as a benchmark for the GMP for each commodity.

“Deliberately identified suppliers or large-scale producers who should be directly contacted to assist in the aggregation of these staples without necessarily applying BPP protocol or going to the open market while arranging to plough back the purchased commodities into the market targeting the vulnerable citizens first.

“Mind you at the current 14% food inflation rate any intervention in the market is already anathema to the principles of GMP but it is a necessary pill to swallow in order to calibrate prices which will make Nigeria’s food system a bit more efficient.

“Creating food banks and transparent and efficient distribution of these items will ensure accountability and probity,” he said.

He emphasized that to ensure the implementation of this programme requires the buy-in of all relevant stakeholders to make the intervention impactful otherwise the program will fail. (The Sun)

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