Economic Outlook: PwC forecasts 3.4% growth for Nigeria in 2025

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Nigeria’s economy is projected to grow marginally by 3.4% this year, according to a report by professional services firm PwC Nigeria. The report, titled “Global Economic Policy Changes and Implications for Nigeria”, was released this week and explores the impact of rising global uncertainty on Nigeria’s economy in 2025.

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The projected growth is expected to be driven by sustained policy reforms, although growth prospects may be limited by elevated economic pressures. “Gross Domestic Product (GDP) may grow marginally by 3.4 per cent in 2025 on the back of sustained policy reforms, albeit growth prospects may be limited by elevated economic pressures,” the report stated.

PwC also noted that fiscal sustainability concerns may remain slightly elevated due to debt servicing costs and a high fiscal deficit, which stood at 7.6% of GDP as of August 2024, exceeding the 2024 approved budget limit of 3.8%. However, the firm predicted that “inflation is expected to decline to 21.46 per cent in 2025 on the back of monetary policy tightening and improving dynamics in Nigeria’s foreign exchange market.

The Central Bank of Nigeria (CBN) is likely to maintain its monetary tightening stance in 2025, focusing on achieving long-term price stability, according to the report. The exchange rate is expected to remain stable in 2025, supported by CBN foreign exchange reforms, which are expected to drive foreign exchange inflows.

However, the report highlighted potential risks, including the introduction of a 14% tariff on Nigerian exports by the United States, which could significantly impact Nigeria’s trade dynamics with the US and potentially hinder the projected marginal GDP growth of 3.4% for 2025.

The report suggests that sustained policy reforms and improved foreign exchange dynamics could boost growth, while persistent economic pressures and potential trade impacts from US tariffs could limit it

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