Nigeria’s economy has fallen in the Africa Country Instability Risk Index, with a weakening naira, rising inflation, and business exits driving the decline.
The country’s GDP is set to shrink, signalling a bleak future for Africa’s once-largest economy.
In November 2024, SBM Intelligence ranked Nigeria’s economy low in the Africa Country Instability Risk Index, reflecting the country’s struggles with a weakened currency, rising inflation, and economic instability.
The report showed that Nigeria, alongside Botswana, Seychelles, Namibia, and Zimbabwe, ranked as the biggest losers in the rankings, with Nigeria’s score falling by -6 due to the exit of foreign businesses and worsening economic conditions.
Consequently, Nigeria, Africa’s fourth-largest economy, faces severe challenges.
Rising food inflation, insecurity, and widespread poverty grip the nation, worsened by unpopular government reforms, including the removal of petrol subsidies.
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As a result, businesses have closed, and many people’s living conditions have worsened.
Furthermore, the country’s GDP, once the largest in Africa, will dip to $253 billion in 2024, down from $477 billion in 2022.
The devaluation of the naira largely explains this decline, as Nigeria falls behind South Africa, Egypt, and Algeria in economic rankings.
Despite a slight increase in GDP measured in naira terms, the IMF downgraded Nigeria’s growth forecast to 3.1% for 2024, far below the 8-10% growth required to sustain its population of over 200 million.
Ultimately, experts such as CFG Advisory warn that Nigeria’s current growth is unsustainable and stress the need for substantial reforms to prevent further economic decline and ensure long-term stability.
