The World Bank has cast doubt on Nigeria’s ambition to achieve a single-digit inflation rate in the near future, describing the target as overly optimistic given the current state of the country’s economy. In its latest economic assessment released on Tuesday, the global financial institution warned that persistent structural challenges, policy inconsistencies, and fiscal pressures would make it extremely difficult for Nigeria to bring inflation down to single digits anytime soon.
According to the report, Nigeria’s inflation, which has remained above 25 percent for months, continues to erode household purchasing power and deepen poverty levels. The World Bank noted that despite monetary tightening measures by the Central Bank of Nigeria (CBN), inflationary pressures persist, driven largely by high food prices, energy costs, and the depreciation of the naira. It added that the removal of fuel subsidies and exchange rate volatility have further complicated the country’s inflation management efforts.
The institution advised Nigerian policymakers to adopt a more pragmatic and gradual approach toward price stabilization rather than setting unrealistic targets that could undermine policy credibility. “Achieving single-digit inflation will require a combination of consistent macroeconomic policies, enhanced productivity, and strengthened fiscal discipline,” the report stated. “However, current conditions indicate that this goal may not be attainable in the short term.”
The World Bank emphasized that beyond monetary measures, Nigeria must also address underlying structural issues such as low agricultural productivity, infrastructural deficits, and weak supply chains that continue to drive up the cost of goods and services. It noted that without significant investment in these sectors, inflation would remain high, and the country’s economic recovery would be fragile.
Reacting to the report, some Nigerian economists agreed with the World Bank’s position, arguing that the government’s inflation target lacks a realistic foundation. They stressed that policy direction must focus on stabilizing the exchange rate, boosting local production, and improving fiscal transparency before any significant inflation reduction can be achieved. “It’s not just about raising interest rates; it’s about fixing the fundamentals,” one analyst noted.
However, government officials have maintained that the single-digit inflation target remains achievable with coordinated efforts between fiscal and monetary authorities. A senior official from the Ministry of Finance said the administration’s economic reform agenda, which includes boosting local manufacturing and improving agricultural output, will begin to yield results within the next two years.
Despite such assurances, the World Bank cautioned that failure to act decisively on structural reforms could push more Nigerians into poverty and widen inequality. It called for sustained policy consistency, better coordination among government agencies, and targeted social interventions to cushion the impact of inflation on vulnerable groups, warning that without such measures, Nigeria’s economic stability could remain under threat for years to come.
