IMF Downgrades Nigeria’s Economic Growth to 3.0%

According to its latest World Economic Outlook report released on Tuesday, the Bretton Wood institution said the downgrade was due to recent tariffs move by the US under President Doland Trump.

“Since the release of the January 2025 WEO Update, a series of new tariff measures by the United States and countermeasures by its trading partners have been announced and implemented, ending up in near-universal US tariffs on April 2 and bringing effective tariff rates to levels not seen in a century.” it noted.

The organisation also projects a 2.7 per cent growth rate for the country in 2026.

The global financial institution noted that while Nigeria faces significant challenges, particularly with inflation, forex volatility, and weak infrastructure, recent policy adjustments, such as the partial unification of exchange rates and removal of fuel subsidies, could enhance investor confidence and stimulate economic activity if properly implemented.

The IMF warned that the US tariffs on its own is a major negative shock to global growth.

“The unpredictability with which these measures have been unfolding also has a negative impact on economic activity and the outlook and, at the same time, makes it  more difficult than usual to make assumptions that would constitute a basis for an internally consistent and timely set of projections,” the April outlook said.

The IMF added that the swift escalation of trade tensions and extremely high levels of policy uncertainty are expected to have a significant impact on global economic activity.

Based on this, it projected that global growth is projected to slow to 2.8 per cent in 2025 and 3 per cent in 2026—down from 3.3 per cent for both years in the January 2025 WEO Update, corresponding to a cumulative downgrade of 0.8 percentage point, and much below the historical (2000–19) average of 3.7 per cent.