Nigeria: As Fiscal Deficit Widens, IMF Projects Nigeria's Investment At 20 Percent of GDP

What the report says

The International Monetary Fund is projecting that Nigeria’s total investment will recover to 20 percent of gross domestic product in 2026, according to a report carried by This Day and distributed by AllAfrica. The forecast would mark the country’s highest investment level since 2020, after several years of decline. The article says investment is expected to rise from 17.76 percent of GDP in 2025 to 19.97 percent in 2026, before edging up again in 2027.

At the same time, the IMF sees Nigeria’s public finances weakening. The fiscal deficit is projected to widen from 1.76 percent of GDP in 2025 to 3.30 percent in 2026, while the primary balance is expected to shift from a surplus to a deficit. Even so, government gross debt is forecast to fall slightly in 2026, suggesting some improvement in debt ratios despite the larger deficit.

The broader outlook in the report is more mixed. The IMF projects real GDP growth of 4.2 percent in 2026, slightly above the 2025 estimate, with non-oil growth also expected to remain positive. It also expects inflation to ease from 2025 levels and the current account surplus to widen. The figures matter because they point to a possible rebound in private investment and output, even as Nigeria continues to face pressure on government finances and living costs.