…Says poverty rate climbs to 63%
The World Bank has painted a mixed picture of Nigeria’s economy, highlighting the protective role of the Ɗangote Refinery in cushioning global energy shocks, even as poverty levels continue to rise sharply across the country.
In an interview with Reuters, World Bank President, Ajay Banga commended the Ɗangote Group for its $20 billion investment in the 650,000 barrels-per-day Ɗangote Refinery, describing it as a critical buffer against the global energy crisis triggered by the ongoing Middle-East conflict involving Iran.
Banga noted that the refinery has significantly boosted Nigeria’s energy security, enabling the country to meet domestic demand and even export aviation fuel to neighbouring countries. “Nigeria should be breathing a sigh of relief,” he said, adding that the investment represents “a really good example” of energy self-sufficiency benefiting both Nigeria and the wider region.
The World Bank warned, however, that the war’s broader economic consequences remain severe. Global growth could decline by up to one percentage point if the conflict persists, while inflation may rise by as much as 300 basis points. Oil prices have already surged by about 50%, disrupting supplies of critical commodities including gas, fertiliser, and food.
Despite a fragile ceasefire announced by U.S. President Donald Trump, tensions remain high, with uncertainty over the reopening of key energy routes such as the Strait of Hormuz. Banga cautioned that a prolonged conflict could further damage global energy infrastructure and deepen economic instability, particularly in developing economies.
While Nigeria appears relatively insulated on the energy front, the World Bank’s latest Nigeria Development Update reveals a worsening domestic reality: poverty rose to 63% in 2025, affecting an estimated 140 million Nigerians.
The report shows that poverty has steadily increased from 56% in 2023 to 61% in 2024, before reaching its current peak, despite a notable decline in inflation. Headline inflation fell from 34.8% in December 2024 to 15.15% in December 2025, while food inflation dropped sharply from 39.84% to 10.84% over the same period.
According to the Bank, the easing of inflation has not translated into improved living standards, as household incomes have failed to keep pace with earlier price shocks. “Poverty has yet to begin declining,” the report stated, pointing to a persistent erosion of purchasing power among Nigerian households.
The institution also linked rising poverty to global shocks—including the Middle East crisis – which have driven up the cost of energy, food, and transportation, disproportionately affecting low-income earners.
Structural issues within Nigeria’s economy have further slowed poverty reduction. The World Bank observed that growth has been concentrated in services and industry, while agriculture – where a majority of the poor are employed – continues to lag behind.
Despite the grim outlook, the bank projects a gradual decline in poverty from 2026, potentially falling to about 59% by 2028, driven by easing inflation and moderate economic growth. However, it warned that progress would remain slow without reforms aimed at boosting job creation and improving productivity, especially in agriculture.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the Federal Government is focused on investment-driven growth and targeted social interventions to lift millions out of poverty. He emphasised the importance of job creation and strengthened social safety nets, including direct benefit transfers, to support vulnerable populations.
The World Bank stressed that while macro-economic stability is important, it must be complemented by inclusive, job-rich growth to meaningfully reduce poverty and improve living standards across Nigeria.
