The African Development Bank Group (AfDB) has projected that Nigeria’s economic growth will slow to 3.7 per cent in 2027 as easing global oil prices reduce external revenue inflows, despite a modest improvement expected in 2026.
According to the African Economic Outlook 2026 report of the AfDB, Nigeria’s growth will rise marginally from an estimated 4.0 per cent in 2025 to 4.1 per cent in 2026.
It noted that the anticipated growth in 2026 will be driven by increasing oil prices and production, expansion in the services sector, and increased public investments in electricity, transport and logistics.
“Growth in Nigeria, the region’s largest economy, is projected to increase marginally from an estimated 4.0 per cent in 2025 to 4.1 per cent in 2026, supported by increasing oil prices and production, growth in the services sector, and increased public investment in electricity, transport, and logistics. In 2027, growth is projected to decelerate to 3.7 per cent on account of the anticipated easing of global oil prices and thus reduced external revenue inflows,” the report said.
The bank warned that Africa’s medium-term outlook remains vulnerable to supply chain disruptions, inflationary pressures, exchange rate depreciation, and tightening global financial conditions.
The report stated that higher fuel and fertiliser prices could weaken agricultural output, increase food insecurity, and worsen inflation across the continent.
The institution explained that that elevated inflation could force African central banks to tighten monetary policy further, thereby weakening growth through reduced lending to the private sector.
It added that prolonged global shocks could heighten debt vulnerabilities, increase borrowing costs, weaken fiscal balances, and constrain public investments and social spending across African economies.
The AfDB urged African countries to adopt coordinated fiscal, monetary, and structural reforms to cushion the impact of recurring global shocks.
“Addressing the adverse impacts of successive waves of shocks and increasing geopolitical fragmentation on African countries requires a holistic approach, comprehensive policy, and financing. African central banks need to implement prudent monetary and exchange rate policies tailored to anchoring long-term inflation expectations,” the report said.
Meanwhile, the President of the AfDB Group, Dr Sidi Tah, said in the report’s foreword that Africa remained resilient despite mounting global and regional challenges.
“Africa stands at a critical juncture in its development journey. Its economies continue to demonstrate remarkable resilience despite numerous concurrent challenges, such as escalating trade tensions, the intensifying effects of climate change, the effect of the COVID-19 pandemic, declining international aid and foreign direct investment, increased global and regional conflicts, and ongoing geopolitical fragmentation,” Tah said.
He added that Africa’s economies expanded in 2025, with average real GDP growth strengthening to 4.4 per cent, placing the continent among the world’s fastest-growing regions. The bank’s president noted that the 2026 outlook report calls for a fundamental rethinking of Africa’s development financing and policy management.
“Achieving sustained and inclusive growth will require a substantial increase in investment. Africa must raise annual growth to 7 per cent or higher, sustained over decades, to enable large-scale job creation and accelerated poverty reduction,” he added,
GIK/APA