Nigeria’s economy was expanding at roughly twice its pre-reform trajectory by the first quarter of 2026, with real GDP growth accelerating from 2.31 percent in early 2023 to 3.89 percent in early 2026, according to a new report by ThinkBusiness Africa, which warned that the central policy challenge was no longer restoring growth momentum but translating that growth into stronger public revenues, poverty reduction, and job creation at scale.

The report, titled Nigeria’s Fiscal Transition: Growth, Debt and the Revenue Reform Test, said that between 2015 and 2022, the economy had expanded at an average of roughly two percent annually, barely keeping pace with population growth, with subdued investment, foreign exchange shortages, and structural distortions limiting the economy’s capacity to attract capital. The acceleration observed since 2023 was driven by exchange-rate liberalization, subsidy removal, improved fiscal transparency, monetary tightening, and measures aimed at restoring confidence in the foreign exchange market.

The report said the reform-driven progress was visible across several indicators: oil production had recovered from historic lows, services activity had expanded, foreign exchange liquidity had improved, and private-sector confidence had gradually strengthened. However, it warned that government revenues continued to lag expenditure requirements, meaning fiscal conditions remained considerably tighter than macroeconomic indicators alone would suggest.

On Nigeria’s public debt, which stood at approximately 159 trillion naira at the end of 2025, ThinkBusiness Africa said headline figures provided only a partial picture. It argued that a substantial portion of the apparent debt growth reflected not new borrowing alone but also exchange-rate revaluation of existing foreign-currency obligations and enhanced fiscal transparency. The more relevant fiscal question, it said, was whether revenues and growth were expanding sufficiently to sustain those obligations over time. The report concluded that both optimism and concern were valid. Growth was strengthening and investment conditions improving, but debt service obligations were rising, fiscal space remained constrained, and revenue mobilization had yet to fully catch up with the scale of the economy