By Francis Ajuonuma
The World Bank has called on the Federal Government to implement urgent reforms to protect Nigeria’s poorest citizens from the harsh impact of rising inflation.
In its latest Poverty and Equity Brief for Nigeria (April 2025), obtained yesterday, the global financial institution also urged the government to enhance the livelihoods of all Nigerians by promoting more productive employment, which it identified as essential for reversing the country’s high poverty rate.
The warning follows an earlier alert by the World Bank in its April Africa’s Pulse report, where it projected that more Nigerians would fall into poverty over the next five years.
It attributed this grim outlook to Nigeria’s persistent structural economic challenges, heavy reliance on oil revenue, and national fragility—factors that continue obstructing meaningful poverty reduction.
To cushion the inflationary effects of recent economic reforms on people experiencing poverty, the Nigerian government launched a temporary cash transfer initiative targeting 15 million households.
However, the World Bank noted that the rollout of this intervention has been sluggish.
Upon assuming office on May 29, 2023, President Bola Tinubu introduced sweeping economic reforms, including removing fuel subsidies and floating the naira. While these policies aimed to stabilise the economy, they triggered a significant surge in inflation.
According to the report, Nigeria’s annual inflation rose slightly to 24.23 per cent in March 2025, up from 23.18 per cent in February—the lowest rate recorded since June 2023.
Food inflation, the most significant component of the inflation basket, remained high but eased to 21.79 per cent from 23.51 per cent the previous month.
Core inflation, which excludes volatile agricultural products and energy prices, climbed to 24.43 per cent in March from 23.01 per cent in February. Consumer prices increased by 3.90 per cent every month, up from 2.04 per cent in the preceding month.
“Multiple shocks in a context of high economic insecurity have deepened and broadened poverty,” the World Bank said. “Since 2018/19, an additional 42 million people have fallen into poverty, with more than half of all Nigerians—54 per cent—estimated to be living in poverty in 2024.”
Although the World Bank acknowledged that the recent macroeconomic reforms have begun to bring stability, it stressed that inflation remains dangerously high.
It said this has eroded consumer demand and severely weakened Nigerians’ purchasing power. Furthermore, labour incomes have failed to keep pace with inflation, pushing more people—especially in urban areas—into poverty.
The World Bank recommended strengthening Nigeria’s social protection system to mitigate the impact of future shocks and avoid the intergenerational transmission of poverty.
It was advised that recent fiscal savings from the Premium Motor Spirit (PMS) reform should be redirected towards building household resilience and supporting human capital development.
“These short-term interventions must be matched with long-term strategies such as economic diversification to grow the non-oil sector and generate private sector employment,” the Bank said.
“Equally crucial are investments in public services, particularly in health, education, and infrastructure. Given the limited fiscal space, improving the efficiency and effectiveness of public investments is critical,” the global bank added.
The Bank also cited official household survey data from the National Bureau of Statistics (NBS), which showed that 30.9 per cent of Nigerians lived below the international extreme poverty line of $2.15 per person per day (2017 PPP) in 2018/19, before the COVID-19 pandemic.
The report highlighted Nigeria’s stark regional disparities in poverty levels. “Nigeria remains spatially unequal. The poverty rate in the northern geopolitical zones stood at 46.5 per cent in 2018/19, compared with 13.5 per cent in the southern zones,” it added.
