By Charles Ebi
Nigeria’s economy is poised to reach its fastest growth rate in over a decade, with real GDP projected to rise to 4.0% in 2025, up from 3.4% in 2024, according to new forecasts by analysts at BMI, a Fitch Solutions company.
This would mark the country’s strongest economic performance since 2013, driven primarily by a recovery in key sectors and a favourable shift in trade dynamics.
The latest figures show that Nigeria’s GDP growth accelerated to 4.6% year-on-year in Q4 2024, up from 3.1% in Q3—the highest quarterly expansion in three years.
The analysts attribute this upturn largely to a robust rebound in the services sector, particularly transportation, which has been recovering from the disruptions caused by the removal of fuel subsidies in 2023.
However, the industrial sector showed signs of weakness, with growth slowing from 2.8% in Q3 to just 1.3% in Q4 2024.
The deceleration is linked to reduced momentum in crude oil output, despite the sector’s critical role in Nigeria’s economy.
According to the analysts, a key driver of expected economic expansion in 2025 is the ramp-up of petrol production by the Dangote oil refinery Africa’s largest which began supplying gasoline to the domestic market in September 2024 after years of delays.
BMI analysts note that continued increases in local refining capacity could make Nigeria a net fuel exporter for the first time in its history, easing the country’s reliance on imported petroleum products and significantly reducing its import bill.
“The expected transition to net fuel exporter status will support Nigeria’s external balances and provide a meaningful boost to GDP”, BMI said, highlighting how improved trade terms will underpin stronger macroeconomic performance.
Despite these tailwinds, Nigeria’s economic growth is not without constraints. Analysts warn that high inflation, elevated interest rates, and persistent fiscal challenges could dampen consumer demand and limit private sector investment in 2025.
These issues pose a risk to the broader economic recovery, particularly in the face of long-standing structural weaknesses.
Regionally, BMI has revised down its 2025 growth forecast for Sub-Saharan Africa ,SSA, to 3.5%, from an earlier estimate of 3.8% .
Nonetheless, this represents a modest improvement from an estimated 3.3% growth in 2024. Easing inflation and borrowing costs are expected to help stimulate consumer spending and business activity across several SSA economies.
However, the downward revision reflects broader global headwinds, including protectionist trade policies and a significant reduction in U.S. foreign aid under the Trump administration, which has slashed 90% of USAID contracts. These developments are expected to weigh heavily on economic performance in aid-dependent countries.
Despite mixed prospects across the continent, BMI forecasts that growth will pick up in South Africa, Nigeria, and Kenya in 2025, while Ghana and Angola are expected to experience slower expansion.
As Nigeria prepares for another year of economic reform and industrial activity, analysts remain cautiously optimistic about its growth outlook, underscoring the need for continued structural improvements to sustain momentum beyond 2025.
