According to the latest International Monetary Fund (IMF) projections for 2026, Nigeria is expected to rank as Africa’s third-largest economy, marking a major turnaround.
Previously, Nigeria ranked as the fourth-largest economy in Africa. The nation has over the past half-decade, dropped from first place to fourth in terms of nominal GDP, reflecting the impact of prolonged economic headwinds.
The IMF’s October outlook paints a cautious picture for the global economy, noting slower expansion amid geopolitical fragmentation, weakened investor sentiment, and the rise of protectionist policies.
Yet, in this climate of uncertainty, Nigeria’s economic resilience appears to be paying off.
Momentum is building, but analysts caution that maintaining the top-three ranking will depend on sustaining reforms, boosting non-oil sectors and strengthening external resilience.
Nigeria’s comeback amid global uncertainty
In the Fund’s 2026 nominal GDP outlook, South Africa is projected to remain Africa’s largest economy with about $443.64 billion, followed by Egypt at $399.51 billion and Nigeria close behind with $334.34 billion.
Algeria and Morocco complete the continent’s top five. This new position returns Nigeria to the top three, a space it previously occupied before a period of economic turbulence.
The IMF’s October report warns that global growth will continue to slow due to fragmentation, rising protectionism, financial vulnerabilities, and policy uncertainty.
The balance of economic power is also shifting, with Asia, led by China, India, and Japan, projected to overtake North America as the world’s largest economic region by GDP. Europe remains third, followed by the Middle East, South America, Africa, and Oceania.
Nigeria’s recovery comes despite not featuring among the IMF’s list of Africa’s fastest-growing economies, which highlighted countries like Benin, Côte d’Ivoire, Ethiopia, Rwanda, and Uganda due to stronger fiscal reforms and stable macroeconomic environments.
The absence shows that Nigeria’s renewed ranking is driven more by its economic scale and reforms rather than growth speed.
Recent policy directions including the removal of fuel subsidies, efforts to stabilise the naira, enhanced oil production, and attempts to improve investor confidence, have contributed to a more optimistic medium-term outlook.
The IMF now forecasts Nigeria’s economy to expand by 3.9% in 2025, reflecting a gradual strengthening of fundamentals after years of structural difficulty.
Still, the path forward remains challenging. Inflationary pressures, foreign exchange instability, and productivity bottlenecks continue to demand tough policy decisions.
If Nigeria is to retain and improve its new standing, economic reforms must translate into tangible growth, competitiveness, and improved living standards.
Nigeria’s projected rise into Africa’s top three economies therefore marks not just a symbolic comeback, but a reminder that sustained execution of reforms will determine how far this recovery goes.
