The World Bank has urged the Federal Government to prioritise reforms that protect the country’s poorest citizens from rising inflation and to enhance the livelihoods of all Nigerians through increased access to productive employment.

This recommendation was contained in the Bank’s Poverty and Equity Brief for Nigeria, published in April 2025 and obtained on Monday.

In a related report – Africa’s Pulse, released last month – the Bank warned that more Nigerians were likely to fall into poverty over the next five years. It cited structural economic weaknesses, an overreliance on oil revenues, and general national fragility as key constraints to sustainable poverty reduction.

In response to the inflationary impact of recent economic reforms, the Federal Government introduced temporary cash transfers targeting 15 million households. However, the World Bank noted that the programme’s implementation has been slow.

Upon assuming office on 29 May 2023, President Bola Tinubu’s administration launched a series of bold economic reforms, including the removal of fuel subsidies and the floating of the Naira. These policies triggered a sharp rise in inflation.

Nigeria’s annual inflation rate inched up to 24.23 percent in March 2025, from 23.18 percent the previous month—its lowest point since June 2023. Although food inflation, which accounts for the largest share of the inflation basket, declined to 21.79 percent from 23.51 percent in February, core inflation (excluding volatile agricultural and energy prices) accelerated to 24.43 percent, up from 23.01 percent. On a monthly basis, consumer prices rose by 3.90 percent in March, compared to 2.04 percent in February.

“Multiple shocks in a context of high economic insecurity have deepened and broadened poverty,” the World Bank said. “Since 2018/19, an additional 42 million Nigerians have fallen into poverty. Over half of the population—54 percent—is projected to be living in poverty by 2024.”

While recent macroeconomic reforms have helped stabilise the economy, the Bank observed that persistently high inflation has weakened consumer demand and eroded purchasing power. Labour incomes have not kept pace with inflation, pushing many Nigerians – especially in urban areas – further into poverty.

The Bank recommended that fiscal savings from the fuel subsidy reform be channelled towards strengthening the social protection system. It said this should focus on building resilience and enabling investments in human capital, to help cushion the impact of future shocks and prevent the inter-generational transmission of poverty.

“These short-term measures must be accompanied by efforts to diversify the economy beyond oil, promote private sector job creation, and increase investments in public services—particularly in health, education, and infrastructure,” the Bank stated. “Enhancing the efficiency and effectiveness of public investment is particularly critical in the face of limited fiscal space.”

Citing the latest official household survey by the National Bureau of Statistics, the report noted that 30.9 percent of Nigerians lived below the international extreme poverty line of $2.15 per day (2017 PPP) in 2018/19, prior to the COVID-19 pandemic.

“Nigeria remains spatially unequal,” it added. “In 2018/19, the poverty rate in the northern geopolitical zones stood at 46.5 percent, compared to 13.5 percent in the southern zones.”