Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has welcomed stronger-than-expected economic growth in the final quarter of 2025, describing it as evidence that ongoing reforms are beginning to stabilise Africa’s largest economy.
Data released by the National Bureau of Statistics showed that Nigeria’s real Gross Domestic Product (GDP) expanded by 4.07 percent year-on-year in the fourth quarter of 2025, marking one of the strongest quarterly performances in a decade outside the post-pandemic recovery period.
In a statement issued Saturday, Edun said the growth reflected broad-based expansion across key sectors under the administration of President Bola Ahmed Tinubu.
“This marks the second time in ten years excluding the immediate post-pandemic rebound that quarterly growth has exceeded four percent,” the minister said, noting that the performance followed 4.23 percent growth recorded in the second quarter of 2025 and an improvement from 3.76 percent in the same period a year earlier.
Broad-Based Sector Expansion
According to the government, growth momentum was supported by improvements across agriculture, industry and services — the three pillars of Nigeria’s economy.
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The agricultural sector grew by 4.0 percent, up from 2.54 percent in the fourth quarter of 2024, helped by improved security conditions in major food-producing regions and better access to farming inputs.
Industrial output expanded by 3.88 percent, compared with 2.49 percent a year earlier. Authorities attributed the improvement to enhanced foreign-exchange liquidity, reforms in the energy sector and rising investor confidence following macroeconomic adjustments introduced since 2023.
Meanwhile, the services sector — Nigeria’s largest contributor to economic output — recorded 4.15 percent growth, driven by continued expansion in finance, telecommunications, trade and technology-related activities.
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Edun said nearly 30 economic subsectors recorded growth above 30 percent, signalling increasing diversification beyond oil dependence.
Full-Year Growth Strengthens
For the full year, Nigeria’s economy grew by 3.87 percent in 2025, accelerating from 3.38% recorded in 2024.
The size of the economy rose to ₦441.5 trillion, up from ₦372.8 trillion the previous year. Using an average exchange rate of roughly ₦1,400 to the U.S. dollar in early 2026, Nigeria’s GDP is estimated at approximately US$315 billion, reinforcing its position as one of Africa’s largest economies.
Edun said the expansion reflected improved fiscal coordination, disciplined public spending and stronger domestic revenue mobilisation efforts.
“This performance reinforces confidence among domestic and international investors and signals that Nigeria’s reform programme is gaining traction,” he added.
Reform Payoff — But Challenges Remain
Since taking office in 2023, President Tinubu’s administration has implemented sweeping economic reforms, including fuel subsidy removal, foreign-exchange market liberalisation and tax system restructuring aimed at restoring macroeconomic credibility.
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While these measures have drawn support from international financial institutions, they have also contributed to short-term inflationary pressures and higher living costs for households.
Recent data nevertheless suggests gradual macroeconomic stabilisation, with improving investor sentiment and easing currency volatility supporting economic activity. Nigeria’s economy grew slightly faster in the fourth quarter compared with earlier periods, helped by both oil and non-oil sector improvements.
Outlook
The finance ministry said it remains committed to sustaining reforms through institutional coordination and transparent engagement with stakeholders to consolidate growth gains.
Economists caution, however, that sustaining growth above 4 percent will depend on continued improvements in security, energy supply reliability, foreign investment inflows and inflation management.
With services maintaining dominance and agriculture showing renewed momentum, policymakers are betting that diversification efforts will gradually reduce Nigeria’s vulnerability to oil price shocks — a long-standing structural weakness in the economy.
For now, the latest GDP figures offer the strongest indication yet that Nigeria’s reform-driven recovery may be taking firmer root.
