By Michael Oche
The International Monetary Fund (IMF) has warned that rising prices of essential goods will worsen poverty and food insecurity in Nigeria, despite projecting stronger economic growth for the country over the next two years.
In its July World Economic Outlook (WEO) Update, released on Wednesday and titled “Global Economy in Crosscurrents of War and Technology,” the IMF projected Nigeria’s economy to grow by 4.1 per cent in 2026 and 4.3 per cent in 2027, supported by improved macroeconomic stability and favourable terms of trade.
However, the Fund cautioned that the benefits of the stronger growth outlook may not be felt by many Nigerians as the cost of essential goods continues to rise.
“Nigeria is supported by improved macroeconomic stability and favourable terms-of-trade effects, though higher prices for essentials are expected to further aggravate poverty and food insecurity,” the IMF said.
The IMF said the outlook for many low-income and energy-importing economies remains challenging as conflicts in the Middle East continue to push up energy and food prices.
According to the report, oil-importing, non-resource-intensive economies will be among the hardest hit by higher prices for food and energy, while countries integrated into the artificial intelligence (AI)-driven technology value chain are expected to record stronger economic activity.
For Sub-Saharan Africa, the Fund projected growth to remain steady at 4.3 per cent in 2026 before rising to 4.5 per cent in 2027, noting that the regional outlook varies significantly depending on countries’ policy choices, reform implementation and exposure to external shocks.
Globally, the IMF forecast economic growth to slow to 3.0 per cent in 2026 before recovering to 3.4 per cent in 2027.
It also projected global headline inflation to rise from an estimated 4.1 per cent in 2025 to 4.7 per cent in 2026, before easing to 3.9 per cent in 2027, suggesting that the disinflation trend seen since early 2024 has stalled.
According to the IMF, ongoing conflict in the Middle East is weighing heavily on energy-importing and vulnerable economies, while demand driven by artificial intelligence is boosting countries integrated into the global technology value chain.
“The impact varies widely based on countries’ exposure to the war and position in the technology value chain,” the report said.
The IMF projected growth in advanced economies at 1.7 per cent in 2026 and 1.8 per cent in 2027, while growth in emerging markets and developing economies is expected to slow to 3.8 per cent in 2026 before recovering to 4.5 per cent in 2027.
Growth in the Middle East and Central Asia is forecast to fall sharply to 0.7 per cent in 2026 before rebounding to 6.5 per cent in 2027, while Latin America and the Caribbean is expected to expand by 2.4 per cent in 2026 and 2.7 per cent in 2027. Emerging and developing Europe is projected to record growth of about 2.0 per cent.
The IMF warned that risks to the global outlook remain tilted to the downside, citing the possibility of renewed conflict in the Middle East, commodity price volatility, supply chain disruptions, trade fragmentation and tighter global financial conditions.
It urged policymakers to maintain price stability, rebuild fiscal buffers and pursue structural reforms aimed at improving energy security, enhancing AI readiness and strengthening international cooperation to support sustainable global growth.
