The World Bank has noted that while the reforms implemented by Nigeria’s government are crucial for the country’s economic recovery, they have exacerbated the difficulties faced by its population, over half of whom are living in poverty.
Since President Bola Ahmed Tinubu assumed office in May 2023, he has introduced several reforms aimed at reviving the economy of Nigeria, Africa’s most populous country.
These reforms include the liberalization of the naira currency, which had been struggling, and the removal of fuel subsidies that had kept gasoline prices low for many years.
According to a report published by the World Bank, these policy shifts are necessary for long-term economic stability. However, in the short term, they have increased the strain on both households and businesses.
Nigeria is currently facing one of its most severe economic crises in recent history, with inflation reaching its highest level in 30 years—surpassing 30 percent—and fuel prices increasing more than fivefold since Tinubu took office.
The World Bank further highlighted the stark rise in poverty levels over the past six years. As of 2023, more than half of Nigeria’s population lives in poverty, with 129 million people now classified as poor. The poverty rate has surged from 40.1 percent in 2018 to 56.0 percent, reflecting significant socio-economic distress.
The report attributes the worsening poverty situation to a range of factors, including the COVID-19 recession, natural disasters such as floods, rising insecurity, the costly demonetization policy introduced in early 2023, soaring inflation, and sluggish economic growth.
The urban population has been particularly affected, with the percentage of urban dwellers living in poverty nearly doubling, from 18 percent to 31.3 percent.
Looking ahead, the World Bank projects that inflation will peak at an average annual rate of 31.7 percent in 2024, driven largely by the naira’s depreciation and escalating gasoline prices.
However, the Bank anticipates that inflation will gradually decrease, reaching 14.3 percent by 2027, as a result of the Nigerian government’s macroeconomic reforms.
