Reported by Ariajegbe Sylvia Esezobor
President Bola Ahmed Tinubu has welcomed the World Bank's October 2026 Nigeria Development Update as fresh proof that his administration's economic reforms are working, while conceding that more must be done to turn macroeconomic gains into better living conditions for ordinary households and urging state governments to spend their increased revenues prudently.
In a statement issued on Sunday by his Special Adviser on Information and Strategy, Bayo Onanuga, the President said the report, titled Beyond the Federal Purse: How Higher Revenues Reshaped State Priorities, confirmed that the difficult decisions taken since 2023 had begun to stabilise the economy. "The findings confirm that the administration's economic reforms are delivering results and placing the economy on a firmer footing for sustained growth," Tinubu said. He credited the removal of the petrol subsidy, the unification of the foreign exchange market and stronger fiscal discipline with raising revenues, stabilising the economy and creating fiscal space for every tier of government to invest in its people.
The World Bank report, released on October 8, found that Nigeria's economy grew by 4.2 per cent in the first half of 2026, up from 3.9 per cent in the same period of 2025 and 3.5 per cent in 2024, driven largely by services and a stronger contribution from agriculture. The Bank projected average growth of at least 4.4 per cent between 2026 and 2028. The uptick in growth stabilised the poverty rate for the first time since 2019, and the Bank expects poverty to decline gradually as GDP grows faster than the population.
The report found that federation revenues rose by 69 per cent in real terms between 2023 and 2025, with states emerging as the largest beneficiaries. Aggregate state revenues rose by approximately 93 per cent in real terms over the same period, while expenditures rose by about 92 per cent. Capital spending increased by 151 per cent, with its share of total expenditure rising from 46 per cent to 61 per cent. Most of the additional spending went to roads and other transport, agriculture, energy and housing. Twenty-nine of 33 states shifted spending towards economic infrastructure, while real social spending per person rose in all but one state. Internally generated revenue grew in real terms in 31 of 35 states, and 21 states reduced their debt-to-GDP ratio between 2021 and 2025.
Nigeria's external position also improved. The current account surplus rose to $12.0 billion, or 7.0 per cent of GDP, in the first half of 2026, up from $8.6 billion a year earlier. Gross external reserves increased from $45.5 billion at the end of 2025 to $53.8 billion at the end of August 2026. Inflation fell sharply from 27.6 per cent in January 2025 to 15.2 per cent in December 2025, although higher global fuel prices linked to the Middle East conflict have since slowed the decline. The Bank expects inflation to ease to about 12 per cent by 2028. Nigeria's overall public debt is projected to fall from 40.0 per cent of GDP in 2025 to 38.1 per cent in 2026.
Despite these gains, Tinubu acknowledged that the benefits of reform have not yet reached every Nigerian household. "The dividends of reform are becoming visible. But more work remains to ensure they fully translate into better living standards for every household, starting with lower food prices and decent jobs for our young people," he said. He pledged to expand targeted cash transfers, which he said had already reached more than 10 million households, accelerate the deployment of compressed natural gas, raise agricultural productivity and improve access to affordable healthcare and quality education. "I assure Nigerians that the best is yet to come under the Renewed Hope Agenda 2.0," he added.
The President used the occasion to issue a direct charge to governors. "I urge state governments to use their higher revenues more prudently and prioritise projects that improve the living standards of Nigerians, and the health and education of our people," he said. The report noted that while spending on health, education and social protection rose substantially, it grew more slowly than spending on economic infrastructure, and education's share of total expenditure declined. The World Bank's Country Director for Nigeria, Mathew Verghis, said the reforms had substantially increased fiscal revenues at the state level, providing a unique opportunity to improve infrastructure, education, healthcare and water services. "Strengthening spending efficiency, accountability, and service delivery will be essential to ensuring that public resources improve the lives of Nigerians," he said.
The report also examined the mixed effects of the Middle East conflict on Nigeria's economy. Higher oil prices strengthened export earnings and contributed to a larger current account surplus, but the gains were moderated by existing oil pre-commitments under forward sales and oil-backed financing arrangements. Gross external reserves rose above $54 billion in September, supported largely by foreign portfolio inflows, while ongoing reforms improved the functioning of the foreign exchange market.
The political context of the President's message is significant. The 2027 general elections are less than four months away, with the presidential and National Assembly elections scheduled for January 16, and the governorship and state assembly elections for February 6. President Tinubu is seeking a second term on the All Progressives Congress platform, while former Vice President Atiku Abubakar of the African Democratic Congress, former Anambra Governor Peter Obi of the Nigeria Democratic Congress and Oyo State Governor Seyi Makinde of the Allied Peoples Movement are among the major challengers. The economy and the cost of living have emerged as the central issues in the campaign, and the World Bank report provides the government with data to support its narrative of progress while placing pressure on governors to demonstrate that increased revenues are translating into tangible improvements. As Tinubu put it, the dividends are becoming visible, but more work remains to ensure they reach every household.
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Reported by Ariajegbe Sylvia Esezobor
President Bola Ahmed Tinubu has welcomed the World Bank's October 2026 Nigeria Development Update as fresh proof that his administration's economic reforms are working, while conceding that more must be done to turn macroeconomic gains into better living conditions for ordinary households and urging state governments to spend their increased revenues prudently.
In a statement issued on Sunday by his Special Adviser on Information and Strategy, Bayo Onanuga, the President said the report, titled Beyond the Federal Purse: How Higher Revenues Reshaped State Priorities, confirmed that the difficult decisions taken since 2023 had begun to stabilise the economy. "The findings confirm that the administration's economic reforms are delivering results and placing the economy on a firmer footing for sustained growth," Tinubu said. He credited the removal of the petrol subsidy, the unification of the foreign exchange market and stronger fiscal discipline with raising revenues, stabilising the economy and creating fiscal space for every tier of government to invest in its people.
The World Bank report, released on October 8, found that Nigeria's economy grew by 4.2 per cent in the first half of 2026, up from 3.9 per cent in the same period of 2025 and 3.5 per cent in 2024, driven largely by services and a stronger contribution from agriculture. The Bank projected average growth of at least 4.4 per cent between 2026 and 2028. The uptick in growth stabilised the poverty rate for the first time since 2019, and the Bank expects poverty to decline gradually as GDP grows faster than the population.
The report found that federation revenues rose by 69 per cent in real terms between 2023 and 2025, with states emerging as the largest beneficiaries. Aggregate state revenues rose by approximately 93 per cent in real terms over the same period, while expenditures rose by about 92 per cent. Capital spending increased by 151 per cent, with its share of total expenditure rising from 46 per cent to 61 per cent. Most of the additional spending went to roads and other transport, agriculture, energy and housing. Twenty-nine of 33 states shifted spending towards economic infrastructure, while real social spending per person rose in all but one state. Internally generated revenue grew in real terms in 31 of 35 states, and 21 states reduced their debt-to-GDP ratio between 2021 and 2025.
Nigeria's external position also improved. The current account surplus rose to $12.0 billion, or 7.0 per cent of GDP, in the first half of 2026, up from $8.6 billion a year earlier. Gross external reserves increased from $45.5 billion at the end of 2025 to $53.8 billion at the end of August 2026. Inflation fell sharply from 27.6 per cent in January 2025 to 15.2 per cent in December 2025, although higher global fuel prices linked to the Middle East conflict have since slowed the decline. The Bank expects inflation to ease to about 12 per cent by 2028. Nigeria's overall public debt is projected to fall from 40.0 per cent of GDP in 2025 to 38.1 per cent in 2026.
Despite these gains, Tinubu acknowledged that the benefits of reform have not yet reached every Nigerian household. "The dividends of reform are becoming visible. But more work remains to ensure they fully translate into better living standards for every household, starting with lower food prices and decent jobs for our young people," he said. He pledged to expand targeted cash transfers, which he said had already reached more than 10 million households, accelerate the deployment of compressed natural gas, raise agricultural productivity and improve access to affordable healthcare and quality education. "I assure Nigerians that the best is yet to come under the Renewed Hope Agenda 2.0," he added.
The President used the occasion to issue a direct charge to governors. "I urge state governments to use their higher revenues more prudently and prioritise projects that improve the living standards of Nigerians, and the health and education of our people," he said. The report noted that while spending on health, education and social protection rose substantially, it grew more slowly than spending on economic infrastructure, and education's share of total expenditure declined. The World Bank's Country Director for Nigeria, Mathew Verghis, said the reforms had substantially increased fiscal revenues at the state level, providing a unique opportunity to improve infrastructure, education, healthcare and water services. "Strengthening spending efficiency, accountability, and service delivery will be essential to ensuring that public resources improve the lives of Nigerians," he said.
The report also examined the mixed effects of the Middle East conflict on Nigeria's economy. Higher oil prices strengthened export earnings and contributed to a larger current account surplus, but the gains were moderated by existing oil pre-commitments under forward sales and oil-backed financing arrangements. Gross external reserves rose above $54 billion in September, supported largely by foreign portfolio inflows, while ongoing reforms improved the functioning of the foreign exchange market.
The political context of the President's message is significant. The 2027 general elections are less than four months away, with the presidential and National Assembly elections scheduled for January 16, and the governorship and state assembly elections for February 6. President Tinubu is seeking a second term on the All Progressives Congress platform, while former Vice President Atiku Abubakar of the African Democratic Congress, former Anambra Governor Peter Obi of the Nigeria Democratic Congress and Oyo State Governor Seyi Makinde of the Allied Peoples Movement are among the major challengers. The economy and the cost of living have emerged as the central issues in the campaign, and the World Bank report provides the government with data to support its narrative of progress while placing pressure on governors to demonstrate that increased revenues are translating into tangible improvements. As Tinubu put it, the dividends are becoming visible, but more work remains to ensure they reach every household.
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