The African Development Bank has launched its 2025 Nigeria Country Focus Report (CFR), projecting that real Gross Domestic Product (GDP) growth will be moderately about 3.2 per cent in 2025 and 3.1 per cent in 2026 for Nigeria. The new figures are, however, down from 3.4 per cent projected in 2024.

The report titled, ‘Making Nigeria’s Capital Work Better for Its Development’, highlighted the urgent need to improve how Nigeria mobilises, manages, and invests all forms of capital – fiscal, financial, human, natural, and business, to accelerate structural transformation and foster inclusive growth.

The report also called for a more strategic and coordinated approach to capital mobilisation as Nigeria advances its economic reform agenda. The launch comes amid bold economic reforms in the country, including the removal of fuel subsidies, unification of exchange rates, and tax reforms.

It emphasised that the measures reflect the government’s commitment to long-term macroeconomic stability and self-reliant development. AFDB Director General in Nigeria, Dr. Abdul Kamara, in his opening remarks, emphasised the significance of the report, saying: “This report is both timely and practical. Nigeria is demonstrating bold leadership through difficult but necessary reforms. Its capital is more than financial; it includes human, natural, and institutional assets.”

Prominent among the report’s findings is the urgent need to enhance domestic resource mobilisation to close Nigeria’s annual development financing gap of USD 31.5 billion.

It noted that “while tax reforms and non-oil revenue expansion are beginning to yield results, the informal sector remains large, tax compliance low, and the tax-to-GDP ratio among the lowest in the region.”

The Head of Fiscal and Tax Reforms Implementation Division at the Federal Inland Revenue Service (FIRS), Mr. Olufemi Olarinde, officially launched the report on behalf of the Federal Government, noting its relevance to Nigeria’s current fiscal trajectory.

“We appreciate the efforts of the African Development Bank in contributing to this important report, which reflects our ongoing work in fiscal and tax reforms. It accurately captures both the strides we are making and the challenges we face as we strengthen Nigeria’s public finance system.”