The World Bank has projected that poverty in Nigeria will rise by three percentage points over the next five years, reaching 2027.
This was disclosed in the Africa Pulse report released during the ongoing Spring Meetings of the International Monetary Fund (IMF) and the World Bank in Washington DC.
According to the report, Nigeria’s poverty outlook remains grim despite signs of economic improvement, particularly in the non-oil sector. The Bank warned that challenges tied to the country’s dependence on natural resources and ongoing fragility could drive poverty rates higher unless significant governance and policy reforms are implemented.
The report noted that while Nigeria saw higher-than-expected economic growth in the final quarter of 2024, particularly in its non-oil sector, the country’s status as a resource-rich and fragile nation means it faces a concerning outlook for poverty reduction.
The report indicates that poverty rates in resource-rich, fragile countries, including Nigeria, are expected to increase by 3.6 percentage points between 2022 and 2027, making it the only group in Sub-Saharan Africa with a projected rise in poverty.
The report stated: “Sub-Saharan Africa has the highest extreme poverty rate globally, and a large share of the poor is concentrated in a few countries. About 80 percent of the world’s estimated 695 million extreme poor resided in Sub-Saharan Africa in 2024, compared to 8 percent in South Asia, 2 percent in East Asia and the Pacific, 5 percent in the Middle East and North Africa, and 3 percent in Latin America and the Caribbean.”Within Sub-Saharan Africa, half of the 560 million extreme poor in 2024 resided in four countries. Non-resource-rich countries are expected to continue reducing poverty faster than resource-rich countries. “Thanks to higher prices of agricultural commodities, non-resource-rich countries will see higher growth overall, despite fiscal pressures. Conversely, resource-rich countries are not expected to grow at the same rate given decelerating oil prices. As a result, resource-rich countries are expected to see less progress in terms of poverty reduction.”Importantly, poverty in resource-rich, fragile countries (which include large countries like the Democratic Republic of Congo and Nigeria) is expected to increase by 3.6 percentage points over 2022–27, being the only group in the region with increasing poverty rates.
“This follows a well-established pattern: resource wealth combined with fragility or conflict is associated with the highest poverty rates—an average poverty rate of 46 per cent in 2024, 13 percentage points above non-fragile, resource-rich countries.
“Meanwhile, non-resource-rich, non-fragile countries saw the biggest gains in poverty reduction since 2000 and fully closed the gap in poverty with other non-resource-rich countries by 2010.”
In response to this outlook, the World Bank advised that resource-rich countries like Nigeria focus on enhancing fiscal responsibility and strengthening the social contract between governments and citizens to address poverty effectively.
What you should know
The World Bank’s Africa Pulse report warns of worsening poverty in Nigeria, predicting an increase of 3.6 percentage points in the poverty rate by 2027.
This projection stems from a mix of persistent economic fragility and an overreliance on natural resources, particularly oil, which makes the country vulnerable to global price shocks and governance challenges.
While Nigeria’s non-oil sector has shown some growth, this has not translated into broad-based poverty reduction.
The report categorizes Nigeria alongside other resource-rich but fragile countries like the Democratic Republic of Congo, where poverty is expected to worsen, unlike non-resource-rich countries that are projected to continue making gains due to better fiscal balance and agricultural-driven growth.
In 2024, the average poverty rate in these fragile nations stood at 46%, significantly higher than in more stable economies.
The World Bank underscores the need for Nigeria to implement inclusive economic policies, improve fiscal management, and build a stronger fiscal relationship with its citizens to tackle poverty. Without these steps, millions more could be pushed below the poverty line, exacerbating inequality and social unrest.
The report serves as a stark reminder that natural wealth alone does not guarantee prosperity without stability and sound governance.
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