Nigeria’s poverty rate climbed to 63 per cent in 2025, even as inflation began to ease, highlighting the limited impact of recent economic improvements on citizens’ living conditions, the World Bank has said.
The revelation was made in the Nigeria Development Update (April 2026) titled “Nigeria’s Tomorrow Must Start Today: The Case for Early Childhood Development,” released in Abuja.
According to the report, poverty levels have steadily increased over the past three years, rising from 56 per cent in 2023 to 61 per cent in 2024, and reaching 63 per cent in 2025.
This translates to approximately 140 million Nigerians living below the poverty line.
The World Bank noted that the rise in poverty occurred despite a significant drop in inflation.
Data from the National Bureau of Statistics showed that headline inflation fell from 34.80 per cent in December 2024 to 15.15 per cent in December 2025. Food inflation also declined sharply from 39.84 per cent to 10.84 per cent within the same period.
However, the bank explained that inflation, though moderating, remains high enough to erode purchasing power, with household incomes failing to grow at a pace sufficient to offset the impact.
“Household incomes have not grown fast enough to offset still-elevated inflation, and poverty has yet to begin declining,” the report stated.
It added that the current poverty situation reflects the lingering effects of earlier inflation spikes, which had already weakened real incomes before prices began to stabilise.
The report also pointed to global economic pressures, including the Middle East conflict, as contributing factors driving up the cost of energy, food, and transportation further straining low-income households.
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Beyond inflation, structural challenges continue to hinder poverty reduction. The World Bank observed that Nigeria’s economic growth has been largely driven by the services and industrial sectors, while agriculture where a significant portion of the poor population is employed has lagged behind.
This imbalance, the report said, has limited income growth among vulnerable groups and slowed the translation of economic gains into improved living standards.
Looking ahead, the World Bank projects a gradual decline in poverty beginning in 2026, with rates expected to drop to about 59 per cent by 2028. This outlook is based on anticipated improvements in macroeconomic stability, lower food inflation, and moderate economic growth.
However, the bank cautioned that the pace of reduction will remain slow due to weak job creation, low agricultural productivity, and persistent inequality.
It stressed that for meaningful poverty reduction to occur, economic growth must be inclusive and capable of generating jobs and increasing incomes, particularly for the most vulnerable populations.
The report also highlighted the link between poverty and human capital development, noting that poorer households face worse outcomes in nutrition, healthcare, and early childhood development, thereby reinforcing long-term inequality.
Speaking at the report’s launch, the World Bank’s Lead Economist for Nigeria, Fiseha Haile, warned that despite improvements in macroeconomic indicators, poverty remains widespread.
He emphasised that while inflation has declined, it still poses risks to real income growth and overall welfare.
Haile further noted that sustainable poverty reduction will depend not only on economic growth but also on its quality particularly its ability to create jobs and improve incomes.
He added that investing in early childhood development is critical to boosting long-term productivity and breaking the cycle of poverty.
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