The International Monetary Fund, IMF, has warned that rising prices of essential goods will deepen poverty and food insecurity in Nigeria despite improved macroeconomic stability, even as it maintained growth forecasts for the economy in 2026 and 2027 at 4.1 per cent and 4.3 per cent.

In its July 2026 World Economic Outlook Update, the IMF also lowered its forecast for global economic growth to 3.0 per cent in 2026 from the average 3.5 per cent recorded in 2024 and 2025, citing the impact of the Middle East conflict and uneven benefits from the artificial intelligence-driven technology boom.

Commenting on Nigeria and Sub-Saharan Africa, the IMF stated: “Growth in sub-Saharan Africa is expected to remain broadly stable at 4.3 percent in 2026, though this masks substantial divergence across countries, reflecting differences in policy space, reform implementation, and exposure to external shocks.

“Oil-importing, non-resource-intensive economies are more adversely affected by higher energy and food prices, whereas some larger economies continue to benefit from earlier stabilization and reform efforts, even though they are largely absent from the AI-driven global technology upswing and face headwinds from the decline in official development assistance.

“Nigeria is supported by improved macroeconomic stability and favorable terms-of-trade effects, though higher prices for essentials are expected to further aggravate poverty and food insecurity.”

The IMF projected Nigeria’s economy to expand by 4.1 per cent in 2026 and 4.3 per cent in 2027, while Sub-Saharan Africa is expected to record growth of 4.3 per cent in 2026 and 4.5 per cent in 2027.

On the global economy, the IMF said: “Global growth is projected to be 3.0 percent in 2026 and 3.4 percent in 2027, down from the average of 3.5 percent observed in 2024–25.”

“The modest slowdown reflects the effects of the war in the Middle East being partly offset by accelerated demand-driven momentum in the global technology cycle thanks to advances in artificial intelligence (AI) and its adoption.”

The IMF further warned: “Global headline inflation is expected to increase from 4.1 percent in 2025 to 4.7 percent in 2026 before declining to 3.9 percent in 2027,” adding that the earlier disinflation trend has stalled.

Highlighting risks to the outlook, the IMF said: “The possibility of renewed Middle East conflict looms large and could extend commodity price volatility, further threaten supply chains, raise prices, and weigh on financial conditions.”

It added that; “Trade fragmentation could accelerate, possibly hurting output and increasing prices,” stressing that governments should restore price stability, rebuild fiscal buffers and pursue structural reforms to strengthen energy security, AI readiness and international cooperation.” (Vanguard)

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