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World Bank reveals that poverty threatens 79% of Nigerians despite reforms

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Despite nearly three years of sweeping economic reforms by the Federal Government, about 79 per cent of Nigerians remain poor or vulnerable to falling into poverty, highlighting the country’s deepening social and economic challenges, new World Bank documents obtained by The PUNCH have shown.

The findings are contained in the World Bank’s newly approved Country Partnership Framework for Nigeria, covering 2026 to 2032, and its accompanying Streamlined Country Diagnostic. The seven-year strategy seeks to support Nigeria’s ambition to create more and better jobs through private-sector-led growth while accelerating poverty reduction.

According to the Streamlined Country Diagnostic document, “Thirty-three per cent of its population is ultra-poor (food insecure by age-weighted caloric intake), 61 per cent is below the poverty line, and 79 per cent is near poor (below the poverty line or vulnerable to falling back into poverty).”

The documents indicate that while recent macroeconomic reforms have helped stabilise the economy and restore investor confidence, the benefits have yet to translate into meaningful improvements in living standards for most Nigerians.

The World Bank noted that Nigeria’s economic performance over the past decade had been constrained by structural rigidities, policy missteps, dependence on crude oil, and repeated external shocks, leaving millions trapped in poverty.

It stated that about 139 million Nigerians currently live below the national poverty line, with poverty concentrated largely in the northern part of the country. The report also noted that more than 86 million Nigerians remain without electricity, while three to four million young people enter the labour market every year with limited employment opportunities.

The Bank said, “Despite recent bold reforms stabilising the economy and laying the groundwork for the Renewed Hope Agenda, significant structural challenges remain.”

It added that sustaining macro-fiscal and structural reforms would be critical to reducing inflation, expanding fiscal space and ensuring that recent economic stabilisation translates into improved living standards.

The reports reviewed reforms introduced by the Bola Tinubu administration, including the removal of petrol subsidy, exchange rate liberalisation, tighter monetary policy and tax reforms.

According to the Bank, the reforms have begun to improve macroeconomic indicators. Economic growth increased from 3.5 per cent in the first half of 2024 to 3.9 per cent during the corresponding period of 2025, foreign reserves exceeded $42bn, fiscal deficits narrowed, and investor confidence strengthened.

However, it warned that high inflation continues to undermine household incomes. The report stated, “High inflation, though declining, continues to erode real incomes, particularly for the poor. Social protection efforts to support the most vulnerable have been slow and uneven in their rollout.”

The Bank added that although the reforms helped Nigeria avoid a more severe economic crisis, institutional weaknesses, weak policy coordination, and inadequate budget transparency continue to pose significant risks. It warned that sustained reform implementation, backed by deeper structural measures, would be required to improve Nigeria’s medium-term economic outlook.

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Under the new Country Partnership Framework, the World Bank said job creation would serve as the primary pathway for reducing poverty. The report explained that international experience from countries such as India, Indonesia, and China shows that moving people into productive employment remains the most effective tool for reducing poverty.

To achieve this, the framework will prioritise labour-intensive sectors, particularly agriculture and micro, small and medium enterprises, while addressing structural deficiencies in electricity, digital infrastructure, education and healthcare.

The document stated that the strategy would support “an agile social transfer system to accelerate poverty exit and prevent backsliding during crises.” It added that interventions would focus on vulnerable regions, particularly northern Nigeria, through agriculture, livelihood support, MSME financing and measures to strengthen resilience against economic and climate shocks.

The Bank stressed that reforms alone would not significantly reduce poverty unless they generate jobs on a large scale. According to the report, one in four Nigerian youths is neither employed, in education, nor in training, while the majority of workers remain trapped in low-productivity, low-paying informal jobs.

It projected that about 60 million young Nigerians would enter the labour force over the next decade, making employment generation Nigeria’s most urgent development priority.

The World Bank also raised concerns over the country’s limited social protection coverage. According to the report, more than three out of every five Nigerians are poor, while over 60 million people are classified as ultra-poor and unable to meet minimum food requirements.

It noted that public spending on social protection represented just 0.14 per cent of Gross Domestic Product in 2021 and that only 8.5 per cent of poor Nigerians were covered by any form of social safety net. The report stated that as ongoing reforms expand fiscal space, directing more resources towards the ultra-poor would be critical to strengthening social resilience.

To address the challenge, the Bank said it would support Nigeria in building a unified, better-targeted and domestically financed social protection system. Drawing lessons from Brazil, Pakistan, Indonesia and India, the framework proposes differentiated support for the ultra-poor, poor and near-poor, alongside expansion of the national social registry, digital identity system and digital payment infrastructure.

The Bank said the strategy also seeks stronger domestic financing, improved coordination between federal and state governments, and closer integration of cash transfers with investments in nutrition, education, healthcare, and sanitation. It added that the interventions are expected to expand social protection coverage to about 41 million beneficiaries.

The diagnostic further observed that employment alone would not immediately eliminate poverty because many Nigerians who already have jobs remain poor. It stated that only about 14 per cent of employed Nigerians currently work in regular wage-paying jobs, while the majority are engaged in informal activities that generate insufficient income to escape poverty.

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The report noted that social protection programmes remain heavily dependent on external financing and must be complemented by investments in education, healthcare and skills development to improve productivity and earnings.

The World Bank also linked poverty reduction to improvements in human capital. It warned that learning poverty remains widespread, with 84 per cent of children aged between five and 14 unable to read age-appropriate texts despite years of schooling.

The Bank identified household poverty as one of the major factors keeping children out of school and limiting future productivity. It also highlighted widespread childhood stunting as a major contributor to intergenerational poverty.

The framework proposes increased investments in nutrition, early childhood development, sanitation, household food security and social protection, targeting an eight-percentage-point reduction in stunting among children under five during the CPF period.

The documents also reviewed the implementation of the previous Country Partnership Framework covering 2021 to 2025. According to the Completion and Learning Review, poverty rose sharply during the period as Nigeria grappled with the COVID-19 pandemic, high inflation, fuel subsidies, exchange rate distortions and worsening insecurity.

The report stated that the poverty rate increased from about 40 per cent in 2019 to 61 per cent in 2025 despite extensive World Bank support. Although the review rated the implementation of the previous framework as “Moderately Satisfactory”, it acknowledged that inflation continued to worsen hardship across the country.

It stated, “A national cash transfer program supported by the World Bank was designed to protect the poor and vulnerable from these shocks, but rollout has been slower than anticipated.”

The review noted that about 8.1 million households had received at least one payment under the national cash transfer programme established to cushion the impact of inflation and economic reforms.

It added that another World Bank-supported resilience programme had reached more than 15 million Nigerians through social safety nets, livelihood support, food security interventions and financial assistance for businesses, including women-owned enterprises. The Bank concluded that preserving the current reform momentum while accelerating private investment, strengthening governance, and creating productive jobs would determine whether Nigeria succeeds in lifting millions of people out of poverty.

According to the Completion and Learning Review, safeguarding and deepening the reforms would be essential if the country is to reignite growth and enable the majority of Nigerians to escape poverty.

The PUNCH earlier reported that the World Bank approved a fresh $1.25bn loan for Nigeria under its Nigeria Actions for Investment and Jobs Acceleration programme, amid public concerns over the country’s rising debt burden and repeated calls for the Federal Government to reduce external borrowing.

The approval was announced in a statement issued by the World Bank alongside the launch of a new Country Partnership Framework for Nigeria covering 2026 to 2032. The bank said the new framework would guide its support for Nigeria over the next six years, with a focus on creating jobs by unlocking private sector-led growth.

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“The World Bank Group has endorsed a new Country Partnership Framework for Nigeria spanning 2026–2032, setting out a strategy to create more and better jobs at scale by unlocking private sector-led growth,” the statement read.

The World Bank Country Director for Nigeria, Mathew Verghis, said the institution would focus on helping Nigeria convert recent macroeconomic gains into improved living standards.

“Our new Country Partnership Framework provides the strategy for how the World Bank Group will support Nigeria over the coming years, with a strong focus on helping to create more and better jobs, particularly by enabling private sector-led growth.

“The recent macroeconomic gains have been critical to help stabilise the economy. Translating improved macroeconomic conditions into better living standards will require addressing the structural constraints to spur private sector investment and job creation,” he said.

The Bank concluded that preserving the current reform momentum while accelerating private investment, strengthening governance, and creating productive jobs would determine whether Nigeria succeeds in lifting millions of people out of poverty.

According to the Completion and Learning Review, safeguarding and deepening the reforms would be essential if the country is to reignite growth and enable the majority of Nigerians to escape poverty.

The PUNCH earlier reported that the World Bank approved a fresh $1.25bn loan for Nigeria under its Nigeria Actions for Investment and Jobs Acceleration programme, amid public concerns over the country’s rising debt burden and repeated calls for the Federal Government to reduce external borrowing.

The approval was announced in a statement issued by the World Bank alongside the launch of a new Country Partnership Framework for Nigeria covering 2026 to 2032. The bank said the new framework would guide its support for Nigeria over the next six years, with a focus on creating jobs by unlocking private sector-led growth.

“The World Bank Group has endorsed a new Country Partnership Framework for Nigeria spanning 2026–2032, setting out a strategy to create more and better jobs at scale by unlocking private sector-led growth,” the statement read.

The World Bank Country Director for Nigeria, Mathew Verghis, said the institution would focus on helping Nigeria convert recent macroeconomic gains into improved living standards.

“Our new Country Partnership Framework provides the strategy for how the World Bank Group will support Nigeria over the coming years, with a strong focus on helping to create more and better jobs, particularly by enabling private sector-led growth.

“The recent macroeconomic gains have been critical to help stabilise the economy. Translating improved macroeconomic conditions into better living standards will require addressing the structural constraints to spur private sector investment and job creation,” he said.

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Nigerian states’ revenues rise 93%, but education spending drops — World Bank

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The World Bank says Nigeria’s 36 states recorded a 93 per cent increase in revenues between 2023 and 2025 but education received a declining share of the sector’s expenditure.

The bank disclosed this in its latest Nigeria Development Update, which examined how increased public revenues have influenced spending priorities across the federation.

The report was made available to the News Agency of Nigeria by the World Bank in Washington D.C.

According to the report, states’ aggregate revenues rose by approximately 93 per cent in real terms, while expenditure increased by 92 per cent during the period.

The report attributed the improvement partly to exchange-rate reforms, petrol subsidy removal, stronger revenue administration and increased allocations from the federation account.

It said states also benefited from refunds, settlement of longstanding federal obligations, intervention funds, and stronger Value Added Tax collections.

However, education’s share of total state expenditure declined from 14.9 per cent in 2021 to 12.1 per cent in 2025, according to the report.

Health expenditure remained broadly stable at approximately seven per cent, while social protection’s share increased from 1.4 per cent to 4.4 per cent.

The bank said capital expenditure increased significantly, accounting for 61 per cent of state spending, compared with 46 per cent previously.

Transport infrastructure recorded the largest increase, alongside substantial spending on housing, agriculture and other economic investments.

The report quoted Mathew Verghis, the World Bank Country Director for Nigeria, as saying that increased revenues provided the opportunity to improve infrastructure, education, healthcare, and water services.

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He said greater spending efficiency, accountability and improved service delivery were essential to ensuring that additional public resources benefited Nigerians.

The bank acknowledged improvements in states’ fiscal reporting, transparency and internally generated revenue.

It, however, stressed that stronger investment in human capital was necessary to translate economic reforms into sustainable employment and improved living standards.

The report also projected average economic growth of 4.4 per cent between 2026 and 2028, subject to sustained reforms and improved service delivery.

It urged federal and state authorities to ensure that increased public revenues translated into tangible improvements in Nigerians’ welfare.

NAN

Source: punchng.com

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Nigeria promotes investment without building production capacity – UNILAG don

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A professor of Comparative Political Economy at the University of Lagos, Adelaja Odukoya, has asserted that Nigeria’s economic policies promote investment without sufficiently strengthening domestic production.

Odukoya argued that the contradiction had weakened the country’s productive foundations, with policies encouraging investment and entrepreneurship while failing to create the technological capacity, productive employment and processing industries needed to drive sustainable development.

Odukoya spoke at the maiden edition of the Adeleke University Toyin Falola Annual Lecture, held on Thursday at the Performing Arts Theatre, Adeleke University, Ede.

The lecture had as its theme, “History, Power and Accumulation: Reimagining Africa in the Globally Disorderly Order.”

Odukoya identified several contradictions in the way the Nigerian state manages economic activity.

He said, “The state promotes investment without creating conditions for technological transfer. It encourages entrepreneurship without generating sufficient productive employment.

“It expands primary-product exports while leaving processing capacity undeveloped. It constructs infrastructure without establishing strong linkages with domestic production.”

According to him, the contradictions explain why increased economic activity and accumulation do not necessarily translate into development.

“Accumulation is not synonymous with development,” Odukoya stated.

He argued that genuine development should be measured by the expansion of productive, technological, institutional and human capabilities.

“A country could attract investment, export minerals and agricultural commodities and record economic activity while still failing to build the domestic industries and technological capabilities required for long-term development,” he said.

His argument was echoed by Prof Toyin Falola, who said Africa’s vast natural resources would continue to reinforce dependency unless governments developed the industrial, technological and institutional capacity to transform them into productive power.

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Falola said Africa’s resource problem was not simply one of historical exploitation, but also the continent’s failure to convert its resource endowments into power.

“The issue, however, is not just to repeat the history of exploitation. It is more important to know how Africa turns its great resources into power,” Falola said.

He argued that Africa could not afford to remain a spectator as global economic and geopolitical arrangements continued to change, stressing that resource ownership without the capacity to add value would not guarantee influence.

Falola said the continent required a combination of knowledge, government policy and industrial capacity to change its economic position.

“There must be universities that generate new knowledge; there must be governments that translate this knowledge into policies; there must be industries that add value to the continent’s natural resources,” he said.

He added that Africa needed more than improved infrastructure and stronger economies if it wanted to exercise greater influence in the global system.

“The future of the continent will require more than just better infrastructure, improved economies, and more effective political institutions,” Falola said.

Source: punchng.com

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Import waivers, insecurity end two-year agric trade surplus

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Import waivers meant to ease hunger and insecurity on farms have led to a deficit, ending a two-year run of surpluses, as Nigeria’s agricultural trade balance swung from a N740.27bn surplus in the first half of 2025 to a N56.13bn deficit in H1 2026, according to agriculture and trade experts.

Recent foreign trade data from the National Bureau of Statistics showed that agricultural exports fell by 33.28 per cent, or N985.14bn, to N1.98tn in H1 2026 from N2.96tn in H1 2025.

Agricultural imports fell by only 8.50 per cent, or N188.74bn, to N2.03tn from N2.22tn over the same period. The gap between the two movements produced a N796.40bn swing in the trade balance.

Nigeria recorded a N365.74bn deficit in H1 2023, when imports of N926.25bn far exceeded exports of N560.51bn. The balance then turned to a N194.92bn surplus in H1 2024 before it widened to N740.27bn in H1 2025.

In separate phone interviews with The PUNCH, Agribusiness experts, including the Chairman of the Lagos Chamber of Commerce and Industry’s Agricultural and Allied Group, Tunde Banjoko, explained that recent government policy led to the shift.

Banjoko said, “Some waivers were given for products like palm oil and rice, and the import tariffs were drastically reduced. It became more favourable for people to import than to patronise local producers.”

He said the waivers on food commodities hurt domestic producers, even though lower tariffs on tractors and manufacturing equipment helped them.

According to Banjoko, “The effect is that our imports will rise above our exports. Second, we will discourage local production. Thirdly, we will be reducing employment, because some factories will shut down if they are not able to compete.”

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Banjoko also said weak funding for processors compounds the problem. He said foreign direct investment flows mainly into the capital market rather than into production and processing, so local processors cannot scale.

He urged the Federal Government to speed up the Special Agro-Industrial Processing Zones programme. “We should speed up such projects where we can produce enough for our country and start exporting, not look for shortcuts by reducing prices,” Banjoko added.

Meanwhile, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, identified two major factors behind the deficit. He said the first was the Federal Government’s decision to allow some food imports to tackle runaway inflation.

Yusuf said, “The first is the decision of the government to allow for some food imports as a result of the challenges of food inflation, which at a point was getting almost completely out of hand.”

He added that insecurity worsened the supply gap and cut export capacity, stating, “Insecurity led many farmers to leave their farms. Many of them have ended up in IDP camps, and quite a number have completely abandoned farming.”

He added that farmers cannot export without output. Yusuf said, “You can only export when you have the output.”

Yusuf also said high input costs and falling produce prices have discouraged farming. He said, “Most of these inputs are imported, so the exchange rate situation has seriously affected the cost of inputs, and the prices of produce have gone down.”

He urged the Federal Government to cut the cost of fertiliser, agrochemicals, machinery and improved seedlings. He also called for a minimum guaranteed price for agricultural produce.

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Yusuf said, “The government can establish a threshold below which, if prices fall, it will give farmers some compensation. That is the way it is done in many other economies.”

Source: punchng.com

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