Nigeria’s Economic Boom: Fastest Growth in a Decade!

• Booming Economy: Nigeria’s economy grew by 4.6% in Q4 2024, hitting a 10-year high.
• Tinubu’s Reforms: Key reforms like the removal of fuel subsidies are driving growth, but also pushing up prices.
• Inflation Alert: Despite the growth, inflation remains a big challenge.
• CBN’s Reserves: Foreign exchange reforms have helped the Central Bank of Nigeria (CBN) rebuild its reserves to over $37 billion.
• Fiscal Improvement: Government revenue increased by 4.5% of GDP in 2024.

Nigeria’s Economic Miracle: Double-Digit Growth Finally Back?

Guess what? Nigeria’s economy is making headlines for all the right reasons! According to the World Bank, our economy grew by a whopping 4.6% in the fourth quarter of 2024. That’s the fastest we’ve seen in ten whole years! Can you believe it?

The Tinubu Effect: How Reforms are Shaking Things Up

So, what’s behind this economic surge? Well, President Bola Tinubu’s reforms are playing a huge role. Think about it: the removal of petrol subsidies, those cuts to electricity allowances, and even the devaluation of the naira. These changes have definitely stirred the pot.

The Good, the Bad, and the Pricey

These reforms have definitely given the economy a boost, but they’ve also led to something not so fun: higher prices. Yep, inflation is still a major headache. The World Bank’s main man for Nigeria, Alex Sienaert, is saying that we need to keep a close eye on things. Tight monetary policy and smart fiscal moves are key.

CBN’s Forex Fortress: $37 Billion and Counting

Here’s some more good news: those foreign exchange reforms? They’ve helped the Central Bank of Nigeria (CBN) build up its reserves. We’re talking over $37 billion now! Sienaert pointed out that this is a huge safety net for the economy, especially when things get shaky globally.

Government’s Big Win: Revenue Soars!

And it doesn’t stop there! The government’s revenue shot up by 4.5% of GDP in 2024. That’s a “remarkable achievement,” according to Sienaert. Better tax collection, the end of those foreign exchange subsidies, and a rise in remittances all played a part. Because of all this extra cash, the government has been able to cut its deficit down to around 3% of GDP in 2024, which is a big drop from the 5.4% in 2023.

The Road Ahead: Smooth or Bumpy?

Now, the World Bank is feeling pretty optimistic about Nigeria’s economic future, but they’re also being cautious. They’re saying that if the government can keep inflation in check and stick to its reform plan, we’re in good shape. But if things get derailed, who knows what could happen?

Fuel Subsidy Removal: Not as Sweet as We Hoped?

Sienaert also dropped a little truth bomb: we haven’t fully felt the impact of removing fuel subsidies yet. So, there’s still more to come.

Key Economic Indicators in 2024