IMF decries high poverty rate, food insecurity in Nigeria

The International Monetary Fund (IMF) has expressed concern over the high poverty rate and food insecurity in Nigeria, despite the modest gains achieved by the Federal Government through various reforms implemented so far.

However, the IMF commended Nigeria for taking important steps to stabilise the economy, enhance resilience, and support growth.

The Fund warned that the country’s macroeconomic outlook remains highly uncertain, as elevated global risk sentiment and lower oil prices could impact the Nigerian economy.

The IMF made these observations following the completion of its 2025 Article IV Staff Mission to Nigeria.

A team from the IMF, led by Axel Schimmelpfennig, IMF Mission Chief for Nigeria, visited Lagos and Abuja from 2 to 15 April to hold discussions for the 2025 Article IV Consultations with Nigeria.

At the end of the visit, Mr Schimmelpfennig issued a statement saying, “The Nigerian authorities have taken important steps to stabilise the economy, enhance resilience, and support growth.

“The financing of the fiscal deficit by the central bank has ceased, costly fuel subsidies have been removed, and the functioning of the foreign exchange market has improved.

“However, these gains have yet to benefit all Nigerians, as poverty and food insecurity remain high.

“The outlook is marked by significant uncertainty. Elevated global risk sentiment and lower oil prices impact the Nigerian economy.

“The reforms implemented since 2023 have placed the Nigerian economy in a stronger position to navigate this external environment.”

Looking ahead, the IMF advised the Federal Government to adjust its macroeconomic policies to further strengthen buffers, reduce inflation, and enhance resilience, while creating enabling conditions for private sector-led growth.

“The authorities communicated to the mission that they will implement the 2025 budget in a manner that is responsive to the decline in international oil prices. A neutral fiscal stance would support monetary policy in bringing down inflation,” the IMF stated.

The IMF further advised that, to safeguard key spending priorities, fiscal savings from the removal of fuel subsidies should be channelled into the budget.

“In particular, adjustments should protect critical, growth-enhancing investments while accelerating and broadening the delivery of cash transfers under the World Bank-supported programme to provide relief to those experiencing food insecurity.

“A tight monetary policy stance is required to firmly guide inflation down. The Monetary Policy Committee’s data-dependent approach has served Nigeria well and will help navigate elevated macroeconomic uncertainty.

“Announcing a disinflation path to serve as an intermediate target can help anchor inflation expectations,” the IMF said.

The IMF team that visited Nigeria for consultations met with the Minister of Finance and Coordinating Minister of the Economy, Wale Edun; the Minister of Agriculture and Food Security, Abubakar Kyari; the Central Bank of Nigeria Governor, Yemi Cardoso; senior government and central bank officials; the Ministry of the Environment; the private sector; academia; labour unions; and civil society.

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