The World Bank stated on Thursday that Nigeria must reduce government waste, channel spending towards targeted poverty alleviation programs, and adhere to realistic budgets to prevent unplanned expenditures.
This recommendation is part of the findings from the World Bank’s latest Nigeria Development Update (NDU) Report, titled “Staying the Course: Progress Amid Pressing Challenges,” which was unveiled in Abuja.
The World Bank also emphasized the need for Nigeria to maintain a stringent monetary policy and enhance policy effectiveness until a sustained path of disinflation is established.
Alex Sienaert, the World Bank’s Lead Economist for Nigeria, remarked that the title of the NDU underscored the importance of sustaining these policies while addressing structural issues to combat inflation and foster long-term investment, growth, and job creation.
During the report’s overview, Sienaert stated that another key recommendation was to unify the exchange rate to better reflect market conditions and to expand the foreign exchange market.
He highlighted four critical areas that must be prioritized to mitigate debt risks and create space for development and poverty-focused spending:
- Continue the removal of the fuel subsidy and enhance transparency in the oil sector.
- Increase non-oil revenues through improved tax policies.
- Protect vulnerable groups by expanding cash transfer programs and strengthening social safety nets.
- Address long-standing structural constraints facing the economy.
“These key policy recommendations will build on Nigeria’s macro-critical reforms and stimulate growth and job creation,” he stated.
Sienaert noted that the recent reforms are beginning to restore macroeconomic stability, projecting GDP growth of 3.3 percent in 2024, with an average annual increase of 3.7 percent expected from 2025 to 2027.