In a surprising revelation, Nigeria, which holds the title of Africa’s largest economy by both size and population, has been noticeably absent from the International Monetary Fund’s (IMF) latest list of the continent’s fastest-growing economies.

The updated statistics highlight a shift in economic dynamics, with smaller nations like Benin Republic, Côte d’Ivoire, Rwanda, Uganda, and Ethiopia taking the lead in Africa’s growth trajectory. These countries are outpacing Nigeria in terms of GDP growth and substantial structural reforms.

Nigeria’s slow growth compared to peers

According to the IMF’s latest projections, Nigeria’s growth is expected to hover around a modest 3.3 percent in 2024, indicating a stagnation when compared to previous years.

In stark contrast, other African nations are experiencing impressive growth rates ranging from 6 to 11 percent. This surge is attributed to improvements in infrastructure, robust institutions, and increasingly diversified economies.

Countries like Rwanda, Benin, Uganda, Ethiopia, Côte d’Ivoire, and Senegal are gaining recognition for their economic resilience and forward-thinking policies focused on reform and innovation.

Africa’s rising economic performers

According to the IMF, the following countries are expected to lead the continent’s growth between 2024 and 2025:

Country Projected Growth Rate Key Growth Drivers

Niger ~11.2% Oil and gas projects, high commodity prices

Senegal ~8.2% Diversified economy, infrastructure expansion

Libya ~7.9% Oil recovery, gradual political stability

Rwanda ~7.2% Tourism rebound, tech investment, sound governance

Côte d’Ivoire ~6.8% Cocoa exports, industrial expansion, infrastructure growth

Ethiopia ~6.7% Manufacturing and reform momentum

Benin ~6.4% Port growth, agriculture exports, fiscal discipline

Uganda ~6.0–7.5% Oil development, infrastructure growth, services sector

These economies are now considered the continent’s “new engines of growth”, largely because of their efforts to diversify away from dependence on commodities and maintain stable macroeconomic management.

Why Nigeria is lagging behind

Despite its vast resources, Nigeria’s economy continues to struggle under structural and policy challenges. The main issues include:

1. Overdependence on oil: The nation’s revenue base still relies heavily on crude oil exports, leaving it vulnerable to global price swings. Efforts at diversification have moved too slowly.

2. Inflation and currency volatility: Persistent double-digit inflation and naira instability have weakened consumer spending and investor confidence.

3. High debt burden: A large portion of government revenue is used to service debt, leaving little room for social and capital investment.

4. Policy inconsistency: Frequent policy changes and weak implementation reduce investor trust and hinder growth outcomes.

5. Infrastructure and energy deficits: Poor electricity supply and transport networks raise costs for businesses, discouraging production and manufacturing.

6. Population pressure: With a population of over 220 million, Nigeria’s GDP growth still trails population growth, limiting improvements in per capita income.

Regional growth momentum

Across the continent, growth remains robust. The African Development Bank (AfDB) forecasts that Africa’s economy will expand by 3.8 per cent in 2024 and 4.2 per cent in 2025—above global averages.

In West Africa, the subregion is projected to grow around 4 per cent, lifted by strong performances in countries like Benin, Côte d’Ivoire, and Senegal.

East African economies such as Rwanda, Ethiopia, and Uganda also continue to post solid growth, supported by political stability, export diversification, and steady investment inflows.

The impact on Nigeria

1. Falling investor interest: Slow economic expansion makes Nigeria less attractive compared to countries with faster-growing and more predictable markets.

2. Worsening poverty levels: Economic growth below population growth continues to trap millions in poverty, as inflation erodes earnings.

3. Macroeconomic risks: Fiscal imbalances and inflationary pressure threaten the country’s ability to attract affordable financing.

4. Need for deeper reforms: Analysts insist Nigeria must adopt stronger fiscal and structural reforms to restore growth and stability.

What Nigeria must prioritise

To reclaim its place among Africa’s growth leaders, Nigeria will need to:

Diversify its economy: Invest in agriculture, technology, manufacturing, and services to reduce dependence on oil.

Improve fiscal discipline: Enhance tax revenue, curb wasteful spending, and focus on infrastructure.

Stabilise the naira: Ensure transparent forex management and sound monetary policy to strengthen investor confidence.

Develop infrastructure: Expand power generation, roads, and logistics to boost productivity.

Enhance business environment: Simplify regulations, guarantee policy stability, and strengthen property rights.

Invest in education and healthcare: A skilled and healthy population is vital for sustained development.

Promote good governance: Curb corruption, ensure accountability, and make public spending more transparent.

A warning sign for Africa’s giant

Nigeria’s exclusion from the IMF’s latest list serves as a reminder that population size and natural resources are not enough to guarantee prosperity.

Smaller nations are overtaking Africa’s largest economy through consistent reforms, fiscal prudence, and innovation.

With the right policy direction and political will, Nigeria can still regain momentum. But without urgent and credible reforms, it risks remaining behind the continent’s fast-emerging growth champions.