Nigeria, other oil-dependent economies in sub-Saharan Africa are growing more slowly than their counterparts – IMF

The International Monetary Fund (IMF) says sub-Saharan Africa’s oil-producing countries are growing at about half the pace of the wider region, in what the IMF describes as “changed and uneven” growth.

The IMF’s regional economic outlook for sub-Saharan Africa, released on Friday, highlights that while diversified economies such as Senegal and Tanzania are expected to grow above the regional average, Nigeria is expected to lag behind, with growth estimated at 2.9 %.

The fund urged oil-exporting countries in sub-Saharan Africa to reform their economies to address uneven regional economic growth.

According to the IMF’s latest World Economic Outlook, the region’s economy is projected to grow by 3.6 percent this year, in line with last year’s growth and down slightly from the 3.8 percent forecast in April.

Commodity-dependent economies continue to lag behind their more diversified counterparts.

IMF Africa Director Abebe Aemro Selassie stressed that Nigeria’s government must “address” the pressing economic challenges that have led to high inflation and increased living costs.

he said, “South Sudan, Nigeria, Angola are all very much in that camp. They had very large macroeconomic imbalances, financing challenges that hindered growth.”

“They (oil exporters) need to find new sources of growth, get more private sector investment – so it’s important to work on reforms to facilitate that,”

The report also noted additional challenges for African oil producers, including the global shift to green energy in response to climate change.

President Tinubu’s reforms

Nigeria is Africa’s largest oil producer, pumping about 1.4 million barrels of oil per day, though below its benchmark of about 2 million barrels per day.

President Tinubu’s 17-month-old administration has instituted bold reforms in the power, energy and foreign exchange sectors to free up funds to invest in critical sectors such as infrastructure, health, power and others.

While President Tinubu’s efforts have been lauded abroad, at home Nigerians are facing the worst inflation of the 21st century, pushing the vulnerable into more severe poverty. The government has instituted a cash transfer program for the vulnerable, but the process has been slow due to digital verification issues.

Economic growth in the SSA region in 2025

Economic growth in sub-Saharan Africa is expected to increase by up to 4.2 percent next year, according to the IMF report. Excluding the region’s largest economies, Nigeria and South Africa, SSA would grow at a much faster rate.

The report found that almost half of the world’s 20 fastest-growing economies this year are in sub-Saharan Africa. However, it warned that even faster growth was essential to tackle widespread poverty and inequality.

A major barrier to accelerated growth remains limited access to affordable finance, with many countries facing substantial debt burdens and high debt service costs.