World Bank warns Nigeria: 139m citizens still in poverty despite reform progress

The World Bank has warned that while Nigeria’s recent economic reforms have begun to stabilize the macroeconomy, millions of citizens remain locked in poverty, unable to feel any tangible benefit from the policy changes.

Speaking at the launch of the latest Nigeria Development Update (NDU) in Abuja on Wednesday, Mathew Verghis, the World Bank’s country director for Nigeria, praised the government for its bold economic reforms but said the challenge now is to ensure that macroeconomic progress translates into better living conditions.

“Over the last two years, Nigeria has tremendously implemented bold reforms — notably around the exchange rate and petrol subsidy,” Verghis said. “These policies have laid the foundation for transforming Nigeria’s economic trajectory for decades to come.”

The NDU report, titled “From Policy to People: Bringing the Reform Gains Home,” recognises early signs of macroeconomic improvement — including stronger revenues, stabilising foreign exchange markets, a modest rise in reserves, and what the Bank describes as “early signs of inflation easing.”

“Growth has picked up, revenues have risen, debt indicators are improving, the FX market is stabilising, reserves are rising, and inflation is finally beginning to come down,” Verghis said. “These are big achievements, and many countries would envy them.”

However, the World Bank warned that these stabilisation gains have yet to translate into improved welfare for ordinary Nigerians.

“In 2025, we estimate that 139 million Nigerians live in poverty. The challenge is clear: how to translate the gains from the reforms into better living standards for all,” Verghis said.

Reforms meet rising hardship

Since mid-2023, the Tinubu administration has pursued a string of tough economic reforms — including the removal of petrol subsidies, exchange rate liberalisation, and tightened monetary policy to rein in inflation and fiscal deficits.

While the policies have earned Nigeria cautious praise from investors and development partners, they have also driven up living costs sharply, particularly through surging food and transport prices.

The World Bank noted that food inflation, which remains above 30%, poses the greatest risk to both reform success and political stability.

“Food inflation affects everybody, but particularly the poor, and has the potential to undermine political support for reforms,” Verghis warned. “Tight monetary policy is important, but it must be complemented by structural reforms to address deep-seated supply and market constraints.”

Next phase

According to the World Bank, Nigeria must now move from policy stabilization to inclusive growth, focusing on three key priorities:

1. Reducing inflation through both monetary control and agricultural productivity gains.
2. Improving efficiency in public spending, including cutting waste and ensuring capital investments reach communities.
3. Expanding social safety nets to cushion the poorest households and build social support for ongoing reforms.

Verghis stressed that these are not “abstract ideas,” but “practical steps that can turn macro-stability into better livelihoods.”

The World Bank pledged continued support for Nigeria’s reform efforts through policy advice, technical assistance, and financing, while calling for sustained coordination between federal and state governments to make reforms truly people-centered.

The NDU report comes amid heightened public frustration over rising inequality, sluggish job creation, and persistent poverty, despite Nigeria’s reform-driven macroeconomic turnaround. For many citizens, the gap between official optimism and everyday reality remains wide — and closing it, analysts say, will determine whether Nigeria’s reform momentum can endure.