Nigeria’s 2025 GDP Growth Hinges on Fiscal Discipline, Reforms and Dangote Refinery Impact – Afreximbank’s Yemi Kale
Nigeria’s 2025 growth outlook will only materialise if policymakers maintain fiscal discipline and stay the course on reforms, Dr. Yemi Kale, Group Chief Economist at Afreximbank, has warned. In an interview with The Guardian, Kale said Afreximbank projects Nigeria’s GDP to grow between 3.4 and 3.6 per cent in 2025, but stressed that this target “is heavily dependent on sustained policy discipline and prudent economic management.”
Kale explained that the forecast rests on a combination of domestic reforms, easing inflation, and the transformative impact of the Dangote Refinery. However, he cautioned that these positive drivers alone will not be sufficient if the government loses momentum on fiscal and foreign exchange reforms. “Without consistent follow-through, the recovery could stall and undermine medium-term prospects,” he said.
According to the economist, the 650,000-barrel-per-day Dangote Refinery has already shifted Nigeria’s refined petroleum trade balance by reducing import dependence and creating new export potential. But he noted that its ultimate impact on growth will depend on operational reliability, stable crude supply, and how exchange-rate movements affect pricing. Kale also warned that with inflation still well above single digits, any premature loosening of monetary policy could reverse recent gains.
Looking beyond Nigeria, Kale described Africa as “resilient but heterogeneous,” highlighting that the continent’s recovery from the COVID-19 and commodity shocks is facing three key external pressures: high global interest rates that have raised borrowing costs, shifting trade policies with new tariffs and industrial frictions, and ongoing supply-chain disruptions from climate and geopolitical tensions. Afreximbank still expects Africa-wide GDP growth to reach about four per cent in 2025, but inflation and external vulnerabilities remain a constraint for many countries.
He urged African governments to deepen structural reforms, adopt targeted fiscal tools, and invest in logistics, energy, and value-added manufacturing to sustain growth. Kale cited East Africa’s strong digital adoption, North Africa’s energy revenue buffers, and West Africa’s reform-driven momentum as examples of resilience, while warning that fragile states and undiversified oil economies remain exposed to shocks. “Resilience is concentrated where macro policy, structural reforms and investment have converged,” he said, emphasising industrialisation and agro-processing as major growth opportunities over the next 12–18 months.
source: The Guardian