The International Monetary Fund (IMF) has warned that rising prices of essential goods will drive more Nigerians into severe poverty and worsen food insecurity despite a positive outlook of the country’s economic growth.
The IMF in its July 2026 World Economic Outlook (WEO) Update, particularly warned that persistent high prices for food and other essentials remain a major threat to household welfare.
While citing improved macroeconomic stability and favourable terms of trade, the Fund retained Nigeria’s growth forecast at 4.1 per cent for 2026 and 4.3 per cent for 2027.
The IMF ascribed the slowdown to the economic impact of the Middle East conflict, adding however, that stronger demand driven by advances in artificial intelligence is expected to provide some support.
The Fund tasked governments to prioritise price stability, rebuild fiscal buffers and accelerate structural reforms aimed at improving energy security, enhancing readiness for artificial intelligence-driven growth and deepening international cooperation.
On Nigeria and the Sub-Saharan African region, the Fund noted that economic performance across the continent would remain uneven, reflecting differences in policy implementation, fiscal capacity and exposure to external shocks.
The report stated that Sub-Saharan Africa is projected to record 4.3 per cent growth in 2026, rising to 4.5 per cent in 2027, adding that while some of the region’s larger economies are benefiting from earlier economic reforms and improved macroeconomic stability, many other countries remain excluded from the productivity gains associated with the global artificial intelligence boom and are facing declining official development assistance.
According to the IMF; “Nigeria is supported by improved macroeconomic stability and favourable terms-of-trade effects, though higher prices for essentials are expected to further aggravate poverty and food insecurity.
“Oil-importing and non-resource-intensive economies across Africa are likely to suffer more from higher food and energy costs than commodity-exporting nations,” it stated.
The IMF further stated that it expects economic growth globally to be moderate as geopolitical tensions and inflation continue to weigh on business activity and consumer spending.
According to the IMF report; “Global growth is projected to be 3.0 per cent in 2026 and 3.4 per cent in 2027, down from the average of 3.5 per cent observed in 2024–25”.
The Fund noted that while the conflict in the Middle East is disrupting trade and energy markets, the rapid adoption of artificial intelligence is providing a counterbalance by boosting productivity and supporting demand in parts of the global economy.
The IMF therefore warned that inflationary pressures is projected to increase from 4.1 per cent in 2025 to 4.7 per cent in 2026 before easing to 3.9 per cent in 2027, thus signalling that earlier trend of moderating inflation has stalled.
The Fund also identified renewed geopolitical tensions as one of the biggest threats to the global economy and warned that a further escalation of the conflict in the Middle East could trigger fresh volatility in commodity markets, disrupt global supply chains, tighten financial conditions and push prices higher.
