IMF excludes Nigeria from list of fastest-growing economies in sub-Saharan Africa

The International Monetary Fund (IMF) has excluded Nigeria from the list of Africa’s fastest-growing economies.

The IMF listed Benin, Côte d’Ivoire, Ethiopia, Rwanda, and Uganda as the fastest-growing economies on the continent in its Regional Economic Outlook report for sub-Saharan Africa, launched on Thursday in Washington DC.

The report, launched at the ongoing annual meetings of the IMF and World Bank, said the region has demonstrated remarkable resilience to “a series of major shocks over the past several years”.

“…and it features several of the world’s fastest-growing economies, including Benin, Côte d’Ivoire, Ethiopia, Rwanda, and Uganda,” the report reads.

“However, economic performance remains markedly weaker in resource-intensive countries and in several conflict-affected states.

“In these economies, which represent most of the region’s population, gains in income per capita remain modest—around 1 percent a year on average, and less in the poorest countries.”

Furthermore, the IMF said economic growth in sub-Saharan Africa is projected to remain at 4.1 percent in 2025 — the same rate as in 2024 — with a modest increase expected in 2026.

REFORM EFFORTS IN NIGERIA, ETHIOPIA

The organisation said forecasts have increased marginally since April, reflecting continued progress toward macroeconomic stabilisation and reform initiatives, including in Nigeria and Ethiopia.

The IMF noted that fiscal fragility remains a major vulnerability across much of the region, particularly among lower-income countries, noting that while average public debt ratios have stabilised, they remain high.

“And the debt-service burden, in terms of interest payments relative to fiscal revenues, has increased steadily, rising far above its level in other regions and crowding out priority development expenditures, for instance in Kenya and Nigeria,” the organisation said.

‘INFLATION TO REMAIN IN DOUBLE-DIGITS TILL YEAR END’

The lender said monetary and external vulnerabilities also “affect parts of the region, particularly low-income countries (LICs)”.

“Median inflation has eased from over 6 percent at the end of 2023 to around 4 percent, driven by lower global food and energy prices alongside tight monetary policies,” the institution said.

The organisation said inflation is projected to remain in double digits through the end of 2025 in roughly one-fifth of the region, including Nigeria, Angola, Ethiopia, and Ghana.

“External buffers also remain under pressure and in many cases need to be rebuilt,” the IMF said.

“In roughly one-third of the region, international reserves fall short of the recommended three months of import cover; in LICs, median reserve levels have declined to about 2.5 months of imports, reflecting exchange rate interventions in support of domestic currencies.”

The lender acknowledged the recent tax reforms implemented in Nigeria, saying the decline in Nigeria’s inflation rate is due to tighter policy measures and adjustments in the exchange rate.