Nigeria has been ranked as Africa’s fourth-largest economy in 2025, with projections indicating that it is poised to climb to third place in 2026, according to new data released by the International Monetary Fund (IMF).
The IMF’s latest economic outlook shows Nigeria maintaining its position behind South Africa, Egypt, and Algeria in 2025, before overtaking Algeria in 2026 as Africa’s third-largest economy. The projected rise reflects anticipated improvements in economic output driven by fiscal reforms, increased oil and gas production, and expanding non-oil sectors.
Analysts attribute the expected growth to a combination of macroeconomic adjustments, including exchange rate reforms, subsidy rationalisation, and efforts to stabilise inflation. The IMF also noted Nigeria’s large population, expanding consumer market, and growing digital and services sectors as key factors supporting medium-term growth prospects.
Despite the positive projection, the IMF cautioned that challenges such as high inflation, unemployment, infrastructure deficits, and foreign exchange pressures continue to weigh on the economy. The Fund stressed that sustained policy consistency, improved revenue mobilisation, and stronger social protection measures would be critical to translating economic growth into improved living standards for Nigerians.
Economic experts say Nigeria’s projected rise in continental ranking underscores its resilience and long-term potential, but warned that headline economic size does not automatically reflect economic wellbeing. They emphasized the need for inclusive growth, private sector expansion, and productivity gains to ensure that economic progress benefits the broader population.
The IMF’s projection has renewed discussions around Nigeria’s role as a key economic driver in Africa, with policymakers and investors closely watching whether ongoing reforms will deliver the stability and growth needed to secure the country’s position among the continent’s top economies in 2026.
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