With Reform Momentum, It’s Time to Bring Gains to the People, Says W’Bank
With Reform Momentum, It’s Time to Bring Gains to the People, Says W’Bank
•Projects 139 million Nigerians living in poverty, 4.4% economic growth, up from 4.2%
• FTSE Russell places Nigeria on watch list for possible return to Frontier Market Index
•Presidency reassures Nigerians of inclusive growth, economic relief
Deji Elumoye, Ndubuisi Francis in Abuja, Nume Ekeghe and Kayode Tokede in Lagos
The World Bank has again acknowledged important steps taken by Nigeria towards stabilising its economy through recent policy reforms, but underscored the need to ensure the gains trickle down to better living standards for its citizens.
According to the latest Nigeria Development Update (NDU), titled “From Policy to People: Bringing the Reform Gains Home,” which was released in Abuja, yesterday, Nigeria has recorded progress in economic growth, domestic revenue mobilisation, monetary policy, and external balances.
However, it pointed to persistent challenges such as high food inflation, widespread poverty, and structural barriers that constrain inclusive growth.
The NDU stated that Nigeria’s economy expanded by 3.9 per cent year-on-year in the first half of 2025, up from 3.5 per cent in the same period of 2024.
The World Bank report came just as global index compiler, FTSE Russell, placed Nigeria on its Watch List for a potential reclassification from Unclassified to Frontier Market status, signalling renewed investor confidence in the country’s improving foreign exchange conditions and capital repatriation environment.
The World Bank report added that Nigeria’s economic growth was driven by strong performance in services and non-oil industries, alongside improvements in oil production and agriculture, stressing that the country’s external position has also strengthened, with foreign reserves exceeding $42 billion and the current account surplus rising to 6.1% of GDP, supported by higher non-oil exports and lower oil imports.
According to the NDU, on the fiscal side, despite lower oil prices, federal deficit is projected at 2.6 per cent of GDP in 2025, broadly unchanged from 2024, while public debt is expected to decline for the first time in over a decade—from 42.9 to 39.8 per cent of GDP.
However, the report cautioned that these macroeconomic gains were yet to translate into tangible improvements in people’s lives.
Many households, it pointed out, continue to face hardship, with poverty and food insecurity remaining high, adding that food inflation remains a major concern as poor households who spend up to 70 per cent of their income on food—have seen the cost of a basic food basket rise five-fold between 2019 and 2024.
The NDU noted that while current reforms are addressing long-standing policy distortions, sustained progress in livelihoods will depend on continued efforts to reduce inflation, foster inclusive growth, strengthen public services, and expand support for the most vulnerable.
“The Nigerian government has taken bold steps to stabilize the economy, and these efforts are beginning to yield results,” said Mathew Verghis, World Bank Country Director for Nigeria. “But macroeconomic stability alone is not enough. The true measure of success will be how these reforms improve the daily lives of Nigerians—especially the poor and vulnerable.”
The NDU listed three urgent priorities for Nigeria to embrace.
These include tackling food inflation by removing trade barriers such as import bans and excessive duties, while addressing structural bottlenecks in seeds, input supply, security, logistics, and infrastructure (including transport, power, storage, and cold chains).
The priorities also include improving the efficiency of public spending through greater fiscal transparency, stronger discipline in Federation Account (FAAC) deductions, and a national pact to align fiscal policy with development objectives, especially human capital investments.
It also alluded to expanding and institutionalising social protection, including regular, domestically financed cash transfers for the ultra-poor and a shock-responsive safety net system to help households manage crises.
Presenting the report, World Bank’s Senior Economist for Nigeria, Samer Matta argued that while the economic outlook remained cautiously optimistic, with growth projected to rise from 4.2 per cent in 2025 to 4.4 per cent in 2027, inflation would continue to pose a major challenge.
“Food inflation remains the biggest tax on the poor,” Matta said, underscoring the need for continued monetary discipline and sustained structural reforms to ensure the benefits of economic recovery reach ordinary Nigerians.
On his part, the World Bank Country Director for Nigeria, Mathew Verghis commended the Nigerian government for implementing bold policy reforms which have begun to stabilise the economy.
However, he lamented that millions of Nigerians were yet to feel the benefits.
“Over the last two years, Nigeria has tremendously implemented bold reforms — notably around the exchange rate and petrol subsidy.
“These policies have laid the foundation for transforming Nigeria’s economic trajectory for decades to come,” Verghis said.
Further acknowledging the impact of the reforms Verghis alluded to rising revenues, stabilising foreign exchange markets, growing reserves, and declining inflation.
“Growth has picked up, revenues have risen, debt indicators are improving, the FX market is stabilising, reserves are rising, and inflation is finally beginning to come down. These are big achievements, and many countries would envy them,” he said.
But, he noted that Nigeria now faces the urgent challenge of converting macroeconomic stability into welfare gains for its people.
“Despite these stabilisation gains, many Nigerians are still struggling. In 2025, we estimate that 139 million Nigerians live in poverty. The challenge is clear: how to translate the gains from the reforms into better living standards for all,” he stated
Food inflation must be tackled decisively to protect the poor and sustain political support for reforms, he said.
“Food inflation affects everybody, but particularly the poor, and has the potential to undermine political support for reforms,” he said.
“Tight monetary policy is important, but it must be complemented by structural reforms to address deep-seated supply and market constraints,” he further explained.
Verghis assured that the World Bank was committed to supporting Nigeria’s economic reform agenda through policy advice, technical assistance, and financing.
Meanwhile, global index compiler, FTSE Russell, has placed Nigeria on its Watch List for a potential reclassification from Unclassified to Frontier Market status, signalling renewed investor confidence in the country’s improving foreign exchange conditions and capital repatriation environment.
The announcement, contained in the firm’s 2025 Annual Equity Country Classification Review, marks a major milestone for Nigeria, almost two years after it was delisted from all FTSE global indices due to severe dollar shortages which hindered investor exits and distorted the FX market.
According to the statement published on the London Stock Exchange Group (LSEG) website, “Nigeria is being added to the Watch List for possible reclassification from Unclassified to Frontier Market status as the market meets the five FTSE Quality of Markets criteria required for attaining Frontier Market classification.”
The firm recalled that Nigeria was downgraded from Frontier to Unclassified status in September 2023 “due to significant and ongoing delays in the ability of international institutional investors to repatriate capital from Nigeria and execute foreign exchange transactions.”
However, the latest review acknowledges that conditions have improved materially under the Central Bank of Nigeria’s (CBN) reforms. “Market participants have reported that the aforementioned FX queues had been cleared and that international institutional investors are no longer experiencing any material delays in their ability to repatriate capital from Nigeria,” FTSE Russell stated.
It added that “as Nigeria now meets the five FTSE Quality of Markets criteria required for attaining Frontier Market status within the FTSE Equity Country Classification scheme, Nigeria is added to the Watch List for potential promotion from Unclassified to Frontier Market status.”
The decision follows extensive engagement with foreign portfolio investors who confirmed that repatriation bottlenecks have eased, and transparency in FX transactions has improved significantly since the CBN introduced reforms earlier in the year. These include the unification of exchange rates, the clearance of FX backlogs, and enhanced liquidity management in the Nigerian Foreign Exchange Market (NFEM).
The Watch List designation, FTSE noted, allows for “in-depth engagement” with Nigerian authorities and market participants ahead of a potential reclassification decision. “As a result of recommendations received from the FTSE Equity Country Classification Advisory Committee and the FTSE Russell Policy Advisory Board, the FTSE Russell Index Governance Board approved the addition of Nigeria to the FTSE Watch List for possible reclassification,” it added.
Market analysts interpret the decision as a strong endorsement of the CBN’s reform drive under Governor Olayemi Cardoso, who has prioritised restoring transparency and investor trust in the FX market following the volatility of 2023. Since early 2025, the apex bank has cleared significant FX obligations, improved trade settlement processes, and strengthened liquidity management tools, helping narrow the gap between the official and parallel market rates, rebuild reserves, and attract renewed foreign participation in Nigeria’s debt and equity markets.
Reacting to the development, Group Managing Director/Chief Executive Officer of Nigerian Exchange Group (NGX Group), Mr. Temi Popoola, described Nigeria’s inclusion on the FTSE Russell Watch List as a testament to coordinated policy reforms and renewed investor optimism.
“Nigeria’s inclusion on the FTSE Russell Watch List is more than recognition; it is a reaffirmation that policy consistency, transparency, and collaboration work.”
“The recent reforms in the foreign exchange market, fiscal policy, and ease of doing business have collectively helped restore investor confidence and address key structural constraints. At NGX Group, we have always viewed such progress as a springboard for deeper capital market evolution. Our focus remains on sustaining liquidity, expanding listings, and leveraging technology and sustainability to enhance the quality of investor participation, ensuring that Nigeria’s market strength becomes both visible and investable on the global stage.”
Observers have also commended the coordinated efforts of the Securities and Exchange Commission (SEC), the CBN, and NGX Group, noting that these institutions have strengthened the overall market ecosystem and aligned domestic market practices with international standards an effort that now positions Nigeria for possible reinstatement into the FTSE Frontier Market Index.
Once successfully reclassified, Nigeria could regain visibility among global frontier peers such as Kenya, Ghana, and Côte d’Ivoire, and attract substantial passive inflows from institutional funds benchmarked to FTSE indices reinforcing the country’s return to the global investment map.
Also, the Presidency yesterday reiterated that President Tinubu remains steadfast in the commitment to inclusive growth and implementing tangible measures to cushion effects of economic hardship nationwide.
In a public enlightenment post on his verified X handle, @SundayDareSD, presidential spokesperson, Chief Sunday Dare, enumerated a broad range of programmes and fiscal reforms driving the administration’s economic recovery and social protection agenda.
The Tinubu administration, he stated, “remains firmly focused on improving household welfare through targeted, verifiable interventions” designed to ensure that economic growth translates directly into improved living standards for citizens.
He named the Conditional Cash Transfer (CCT) programme as one of the flagship interventions, noting that it has been expanded to reach up to 15 million households nationwide, with over N297 billion disbursed since 2023 to poor and vulnerable families.
Beneficiaries, he said, are being enrolled through a verified digital process under the National Social Register.
The presidential media aide also highlighted the Renewed Hope Ward Development Programme (RH-WDEP) as “a major new initiative targeting all 8,809 electoral wards,” delivering micro-infrastructure, livelihood support, and social services directly at the community level.
According to him, the administration is consolidating the National Social Investment Programmes (NSIPs) — including N-Power, GEEP micro-loans (TraderMoni, MarketMoni, FarmerMoni), and the Home-Grown School Feeding Programme — to protect jobs, encourage small enterprise, and keep children in school.
Dare said the administration’s food security initiatives are aimed at curbing inflationary pressure on staple goods through the distribution of subsidised grains and fertilisers, mechanisation partnerships, and the revival of strategic food reserves.
He further mentioned the establishment of the Renewed Hope Infrastructure Fund (RHIF) to finance critical energy, road, and housing projects, which are expected to lower living costs and generate local employment.
The National Credit Guarantee Company (NCGC), he further explained, is expanding access to affordable credit for small businesses, women, and youth entrepreneurs through risk-sharing partnerships with commercial banks.
Dare acknowledged that reforms such as fuel subsidy removal, exchange rate unification, and fiscal redirection toward productive sectors have been challenging but described them as necessary choices to tackle the root causes of poverty rather than its symptoms.
“Even the World Bank itself has acknowledged that these reforms are already restoring macroeconomic stability and renewed growth momentum,” he added.
He stressed that while recovery is underway, the government’s focus remains on ensuring that “economic growth must be inclusive.”
This, he said, means translating macroeconomic stability into affordable food, quality jobs, and reliable infrastructure that directly improve the lives of Nigerians.
According to the presidential spokesperson, investments are being scaled up in agriculture, MSMEs, and power reliability.
He said the agricultural value chain expansion programme, gas-to-power initiatives, and skills development hubs are all designed to create jobs and reduce living costs.
“As these programmes mature, Nigerians should begin to feel more visible improvements in food prices, income, and purchasing power,” he assured.
Dare explained that the Tinubu government is not merely reviewing but strengthening and consolidating its social investment architecture through a unified, data-driven framework to enhance transparency, accountability, and digital targeting.
“This includes the scaling up of existing NSIP schemes, the ongoing expansion of the National Social Register, and the rollout of the Renewed Hope Ward Development Programme—ensuring no vulnerable community is left behind”.
He emphasised that President Tinubu’s government remains focused on empowering households, expanding opportunity, and building a resilient, inclusive economy where growth translates directly to improved living standards.
“The reforms are necessary. The direction is right. The foundation for a fairer and more prosperous Nigeria is being firmly laid,” the presidential aide said .
•Projects 139 million Nigerians living in poverty, 4.4% economic growth, up from 4.2% • FTSE Russell places Nigeria on watch list for possible return to Frontier Market Index •Presidency reassures
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