The International Monetary Fund (IMF) has released its latest Regional Economic Outlook for Sub-Saharan Africa, confirming that Nigeria, the continent’s largest economy, is not among the fastest-growing nations. This news comes despite Nigeria’s recent policy reforms and an upward revision of its own growth forecast.
The Continent’s Fastest Growers
According to Abebe Selassie, Director of the IMF’s African Department, overall economic growth across Sub-Saharan Africa is projected to stabilize at 4.1 per cent in 2025, with a modest pickup expected in 2026. This stability is attributed to progress in macroeconomic stabilization and ongoing reform efforts.
However, a select group of five countries are outpacing the rest and now rank among the worldss fastest-expanding economies. These nations are:
Benin Republic
Côte d’Ivoire
Ethiopia
Rwanda
Uganda
The IMF credits the strong growth trajectory of these leading economies to sustained policy reforms, improved fiscal management, and strategic investments in critical infrastructure and manufacturing sectors.
Nigeria’s Status and Challenge
Nigeria’s omission from this elite list highlights a persistent challenge in translating size into rapid growth. While the IMF recently revised Nigeria’s growth forecast upward to 3.9 per cent for 2025—a 0.5 percentage point increase from previous predictions this growth rate is still considered below the nation’s potential and falls short of the pace set by the continent’s top performers.
The optimism for Nigeria’s 3.9 per cent expansion is fueled by expectations of higher oil output, improved investor confidence, and supportive fiscal policies. Nonetheless, the IMF has urged the government to deepen structural reforms, particularly focusing on improving electricity supply, curbing persistent inflation, and expanding non-oil revenue through industrial diversification and enhanced tax administration to unlock faster and more inclusive growth.
Broader Regional Concerns
The IMF also raised concerns about rising financial vulnerabilities across Sub-Saharan Africa. With access to external financing tightening, many governments, including Nigeria’s, are increasingly relying on domestic bank borrowing to sustain public spending. This trend has resulted in about half of the region’s public debt now being held by domestic financial institutions, a deepening of the “sovereign-bank nexus” that heightens risks to banking sector stability in countries with high debt levels and elevated interest rates.
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