The World Bank has forecasted an increase in poverty levels in Nigeria by three percentage points over the next five years, reaching the year 2027. This forecast was detailed in the Africa Pulse report, which was published during the ongoing Spring Meetings of the IMF and World Bank in Washington, DC.
The report highlights a troubling scenario regarding poverty in Nigeria, indicating that despite some positive trends in economic activity, the persistent issues related to resource dependence and fragility are likely to exacerbate poverty levels. This situation necessitates targeted and effective governance reforms along with inclusive economic policies.
While Nigeria experienced unexpected economic growth in the last quarter of 2024, particularly within its non-oil sector, its classification as a resource-rich and fragile nation presents a worrying outlook for poverty alleviation. The report also reveals that poverty rates in resource-rich, fragile nations, including Nigeria, are anticipated to rise by 3.6 percentage points from 2022 to 2027, positioning Nigeria among the few countries in Sub-Saharan Africa expected to see an increase in poverty.
It is noted that Sub-Saharan Africa holds the highest extreme poverty rate globally, with a significant proportion of the impoverished population concentrated in a limited number of countries.
Approximately 80 percent of the estimated 695 million individuals living in extreme poverty worldwide resided in Sub-Saharan Africa in 2024, in stark contrast to 8 percent in South Asia, 2 percent in East Asia and the Pacific, 5 percent in the Middle East and North Africa, and 3 percent in Latin America and the Caribbean.
In Sub-Saharan Africa, it is projected that by 2024, 280 million of the 560 million individuals living in extreme poverty will be concentrated in four specific nations. Countries that do not possess abundant natural resources are anticipated to maintain a more rapid pace of poverty reduction compared to those that are resource-rich.
Due to the rise in agricultural commodity prices, countries that lack abundant natural resources are projected to experience overall growth despite facing fiscal challenges.
In contrast, nations rich in resources are anticipated to grow at a slower pace due to declining oil prices. Consequently, these resource-rich nations are likely to make less progress in alleviating poverty.
It is noteworthy that poverty levels in resource-rich, fragile countries, including significant nations such as the Democratic Republic of Congo and Nigeria, are expected to rise by 3.6 percentage points from 2022 to 2027, marking them as the only group in the region with increasing poverty rates.
This adheres to a well-recognized trend: the combination of resource wealth with instability or conflict correlates with the highest levels of poverty—projected to average 46% in 2024, which is 13 percentage points higher than that of non-fragile, resource-rich nations.
Furthermore, non-resource-rich and non-fragile countries have experienced the most significant advancements in poverty alleviation since 2000, successfully bridging the poverty gap with other non-resource-rich nations by 2010. As a result, the report emphasizes that for resource-abundant countries such as Nigeria, enhancing fiscal management and establishing a more robust fiscal agreement with citizens is essential.
