Nigeria’s 2025 economic strategies combine bold reforms and massive spending.

Surging reforms are stabilizing macro fundamentals, but elevated inflation, heavy debt burdens, and execution inefficiencies remain major risks.

Vigilance in policy discipline, realistic budgeting, and prioritizing inclusive growth will determine whether 2025 becomes a turning point or merely a year of potential unrealized.

Here’s a comprehensive overview of Nigeria’s 2025 economic landscape, covering GDP growth, public finances, budget priorities, and government spending:

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Economic Growth & Inflation

The Central Bank forecasts 4.17% GDP growth in 2025, driven by reforms such as fuel subsidy removal, naira devaluation, and increased oil production—expected to reach 2.3 mbpd by mid-year.

Inflation remains a concern. Peaking near 34.8% early in the year, but gradually declining as reforms take effect.

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Public Finances & Debt

The 2025 federal budget totals ₦54.99 trillion (~$36.6 billion), marking the largest in 65 years—about 57% larger than 2024.

Revenue targets are ~₦41.8 trillion from oil and non-oil sources, leaving a projected fiscal deficit of ~₦13 trillion (~3.9% of GDP).

Debt servicing consumes a hefty slice—around 32% of total expenditure, crowds out growth funding .

IMF warns that deficit could widen to 4.7% of GDP without recalibration, urging adjustments for subdued oil prices (~$68 vs. budgeted $75/barrel).

Debt-to-GDP at ~53% in 2024 is expected to decline slightly. IMF projects ~45% by 2030, contingent on maintained fiscal discipline.

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Budget Structure & Spending Focus

Recurrent (operational) spending and debt service account for about 65% of the budget, squeezing capital project investment. Security received a major boost this year. It was assigned ₦6.11 trillion, up from ₦3.25 trillion in 2024—nearly 9–10% of total spending—to combat insurgency and banditry.

Infrastructure gets ₦4 trillion, health ₦2.48 trillion, and education ₦3.52 trillion—yet these remain below international benchmarks.

Notable capital projects include the Lagos–Calabar Coastal Highway and Lagos Green Line Metro, but disbursement often lags under 80% execution rates.

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Fiscal Reforms & Revenue Mobilization

Foreign exchange liberalization, ended CBN deficit financing, widened tax base, fuel subsidy removal—leading to better foreign-reserve levels and investor confidence. Still, revenue-to-GDP ratio remains low (~11%), well behind peers; VAT hikes and broader tax compliance expected but face local resistance.

IMF recommends channelling subsidy savings (~2% of GDP) into infrastructure and cash-transfer safety nets.

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Economic Pressures & Risks

Inflation—especially food prices—is still high (~24–34%), hurting households and oil-price volatility at ~$68/barrel threatens revenue assumptions.

Slow project rollout, cash-transfer targeting issues, and opaque public procurement remain key hurdles.

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Outlook & Policy Path

Continued attention is needed to tighten spending, realign budget to realistic oil prices, and expand revenue base through tax reforms. Scaling up social safety nets and infrastructure investment is also critical for inclusive growth and poverty reduction.

More so, a coordinated fiscal and monetary policy stance—e.g., maintaining tight monetary policy—will help sustain macro stability .

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