The International Monetary Fund (IMF) has urged Nigeria and other major African economies to intensify fiscal, monetary and governance reforms as they seek stronger economic stability and more inclusive growth. The Fund said improving how governments raise and spend money, manage monetary policy and strengthen institutions will be critical to achieving sustainable economic progress.
In its latest assessment of reform priorities across the African Union’s largest economies, the IMF identified fiscal reforms as a major priority in seven of the eight countries reviewed. For Nigeria, the Fund highlighted the need to improve tax policy, revenue collection, public financial management and spending efficiency, areas that remain central to the country’s efforts to expand government revenue without putting additional pressure on businesses and households.
The IMF also called for stronger monetary policy frameworks and better transmission of monetary decisions in Nigeria, Egypt and Ethiopia. In Nigeria, the recommendation comes after years of aggressive monetary tightening by the Central Bank of Nigeria (CBN), which pushed the Monetary Policy Rate from 18.75% in 2023 to 27.5% by the end of 2024. Although the CBN has since moved towards gradual easing as inflationary pressures have moderated, concerns remain over the impact of high borrowing costs on businesses and economic growth.
Beyond fiscal and monetary policy, the IMF said Nigeria needs stronger governance, greater fiscal transparency, improved public financial management and more effective anti-corruption measures. The recommendations come as the Federal Government continues to implement its tax reform programme, which took effect in January 2026 and aims to simplify tax administration, improve compliance and widen the revenue base. However, businesses continue to complain about multiple taxes and levies, with the CBN’s July 2026 Business Expectations Survey showing that 70.8% of respondents identified high and multiple taxation as their biggest business constraint.
The IMF said implementing the recommended reforms could help Nigeria and other major African economies mobilise more domestic revenue while strengthening their economic institutions. The Fund’s latest position also comes amid concerns over Nigeria’s proposed financing arrangements, including a plan to raise up to $5 billion through derivatives-based financing, which the IMF previously warned could expose the country to significant financial risks. For Nigeria, the message is clear: deeper reforms, stronger institutions and more efficient management of public resources will be crucial if the country is to achieve more stable and inclusive economic growth.
source: nairametrics
