Economy
Sub-Sahara is recovering from unprecedented crisis, but—IMF
International Monetary Fund has said that “Sub-Saharan Africa (SSA) is recovering from an unprecedented crisis. Following the sharp contraction of 2020, growth accelerated in 2021, supported by improvements in international trade and commodity prices. Yet, the outlook remains very uncertain given the slow progress in equitable access to vaccinations in the region, limited policy space in many countries, and now spillovers from the war in Ukraine. The latter is likely to exacerbate inflationary pressures from food and fuel, worsen the fiscal positions of SSA countries, and disrupt capital flows, possibly jeopardising access to external financing. Given these additional challenges, the work of African governments and development partners to support the recovery and the continent’s most vulnerable people has only grown more urgent. Africans cannot be left behind. While measures to address current crises are ongoing, the implementation of transformative reforms to unlock the continent’s strong economic potential should not be delayed.
Recognising that needed reforms must address stakeholder concerns in each country, we are committed to improving our assessment and consideration of political economy factors as we work with countries to design and implement sustainable, broadly supported fiscal reforms. The Forum is focused on four fiscal policy priorities for resilient, inclusive economies: Prioritise spending by enhancing the efficiency of government expenditure, public financial management, and refocusing efforts on public investments in physical and digital infrastructure and a green recovery; put poverty back on a downward trend by strengthening social protection programs, investing in health and education, and compensating those negatively affected by needed reforms; mobilise tax revenues, starting with the difficult actions needed to improve the efficiency and equity of tax systems and address debt vulnerabilities by setting clear and prudent medium-term fiscal targets and, in many countries, undertaking fiscal consolidation in a carefully planned and sequenced manner, underpinned by a robust institutional framework.
“African countries should have strong ownership of reforms, but they should not have to walk the path of reform alone. Partnership with the international community is critical, considering the region’s elevated financing needs and a widening gap with the rest of the world. Since the start of the pandemic, IMF financial assistance to sub-Saharan Africa totalled over $26 billion. Europe has committed more than €9.8 billion to the external response to COVID-19 in Africa. Countries’ efforts are also supported by capacity development. Experts work with country authorities every day to help build the institutions necessary to formulate and implement sound economic policies. In 2020 and 2021, the Fund had over 2,000 CD engagements annually in the region; this year, we expect to do even more. The European Commission is heavily investing in building capacity in line with our Collect More Spend Better Approach, in close coordination with the partner countries and the IMF.
“Beyond financing, policy advice, and CD, the international community should also continue adapting its operations to better respond to country needs and mitigate policy implementation risks. For instance, the IMF plans to launch a new engagement strategy in fragile and conflict-affected countries later this year, with more tailored conditionality and a greater focus on political economy risks. The IMF is also in the process of establishing a Resilience and Sustainability Trust—a new lending facility with longer maturity loans, which aims to address macro-critical structural challenges, including climate change, pandemic preparedness, and digitalisation. Our common goal is to continue to work closely with African authorities to support the post-pandemic recovery and build stronger and more inclusive economies.”
The Arab Africa Trade Bridges (AATB) Program and the Federal Republic of Nigeria formalized a partnership with the signing of the AATB Membership Agreement, officially welcoming Nigeria as the Program’s newest member country. The signing ceremony took place in Abuja on the sidelines of the 5th AATB Board of Governors Meeting, hosted by the Federal Government of Nigeria.
The Membership Agreement was signed by Eng. Adeeb Y. Al Aama, the CEO of the International Islamic Trade Finance Corporation (ITFC) and AATB Program Secretary General, and H.E. Mr. Wale Edun, Minister of Finance and Coordinating Minister of the Economy, Federal Republic of Nigeria. The Agreement will provide a strategic and operational framework to support Nigeria’s efforts in trade competitiveness, promote export diversification, strengthen priority value chains, and advance capacity-building efforts in line with national development priorities. Areas of collaboration will include trade promotion, agribusiness modernization, SME development, businessmen missions, trade facilitation, logistics efficiency, and digital trade readiness.
The Honourable Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, called for deeper trade collaboration between African and Arab nations, stressing the importance of value-added Agribusiness and industrial partnerships for regional growth. Speaking in Abuja at the Agribusiness Matchmaking Forum ahead of the AATB Board of Governors Meeting, the Minister said the shifting global economy makes it essential for African and Arab nations to rely more on regional cooperation, investment and shared markets.
He highlighted projections showing Arab-Africa trade could grow by more than US$37 billion in the next three years and urged partners to prioritize value addition rather than raw commodity exports. He noted that Nigeria’s growing industrial base and upcoming National Single Window reforms will support efficiency, investment and private-sector expansion.
“This is a moment to turn opportunity into action”, he said. “By working together, we can build stronger value chains, create jobs and support prosperity across our regions”, Edun emphasized. “As African and Arab nations embark on this journey of deeper trade collaboration, the potential for growth and development is vast. With a shared vision and commitment to value-added partnerships, we can unlock new opportunities, drive economic growth, and create a brighter future for our people.”
Speaking during the event, Eng. Adeeb Y. Al Aama, Chief Executive Officer of ITFC and Secretary General of the AATB Program, stated: “We are pleased to welcome Nigeria to be part of the AATB Program. Nigeria stands as one of Africa’s most dynamic and resilient economies in Africa, with a rapidly expanding private sector and strong potential across agribusiness, energy, manufacturing, and digital industries. Through this Membership Agreement, we look forward to collaborating closely with Nigerian institutions to strengthen value chains, expand regional market access, enhance trade finance and investment opportunities, and support the country’s development priorities.”
The signing of this Agreement underscores AATB’s continued engagement with African countries and its evolving portfolio of programs supporting trade and investment. In recent years, AATB has worked on initiatives across agribusiness, textiles, logistics, digital trade, export readiness under the AfCFTA framework, and other regional initiatives such as the Common African Agro-Parks (CAAPs) Programme.
With Nigeria’s accession, the AATB Program extends it’s presence in the region and adds a key partner working toward advancing trade-led development and fostering inclusive economic growth.
Federal Executive Council (FEC) has approved the 2026–2028 Medium-Term Expenditure Framework (MTEF), a key fiscal document that outlines Nigeria’s revenue expectations, macroeconomic assumptions, and spending priorities for the next three years. The approval followed Wednesday’s FEC meeting presided over by President Bola Tinubu at the State House, Abuja. The Minister of Budget and Economic Planning, Senator Atiku Bagudu made this known after the meeting.
The Minister said the Federal Government is projecting a total revenue inflow of N34.33 trillion in 2026, including N4.98 trillion expected from government-owned enterprises. Bagudu said that the projected revenue is N6.55 trillion lower than earlier estimates, adding that federal allocations are expected to drop by about N9.4 trillion, representing a 16% decline compared to the 2025 budget.
He said that statutory transfers are expected to amount to about N3 trillion within the same fiscal year. On macroeconomic assumptions, FEC adopted an oil production benchmark of 2.6 million barrels per day (mbpd) for 2026, although a more conservative 1.8 mbpd will be used for budgeting purposes. An oil price benchmark of $64 per barrel and an exchange rate of N1,512 per dollar were also approved.
Bagudu said the exchange rate assumption reflects projections tied to economic and political developments ahead of the 2027 general elections. He said the exchange rate assumption took into account the fiscal outlook ahead of the 2027 general elections.
The minister said that all the parameters were based on macroeconomic analysis by the Budget Office and other relevant agencies. Bagudu said FEC also reviewed comments from cabinet members before approving the Medium-Term Fiscal Expenditure Ceiling (MFTEC), which sets expenditure limits. Earlier, the Senate approved the external borrowing plan of $21.5 billion presented by President Tinubu for consideration The loans, according to the Senate, were part of the MTEF and Fiscal Strategy Paper (FSP) for the 2025 budget.
The spot rate on Nigerian Treasury bills has been increased by 146 basis points by the Central Bank of Nigeria (CBN) following tight subscription levels at the main auction on Wednesday. The spot rate on Treasury bills with one-year maturity has now surpassed Nigeria’s 16.05% inflation by 145 basis points following a recent decision to keep the policy rate at 27%.
The Apex Bank came to the primary market with N700 billion Treasury bills offer size across standard tenors, including 91-day, 182-day and 364 day maturities. Details from the auction results showed that demand settled slightly above the total offers as investors began to seek higher returns on naira assets despite disinflation.
Total subscription came in at about N775 billion versus N700 billion offers floated at the main auction. The results showed rising appetite for duration as investors parked about 90% of their bids on Nigerian Treasury bills with 364 days maturity. The CBN opened N100 billion worth of 91 days bills for subscription, but the offer received underwhelming bids totalling N44.17 billion.
The CBN allotted N42.80 billion for the short-term instrument at the spot rate of 15.30%, the same as the previous auction. Total demand for 182 days Nigerian Treasury bills settled at N33.38 billion as against N150 billion that the authority pushed out for subscription. The CBN raised N30.36 billion from 182 days bills allotted to investors at the spot rate of 15.50%, the same as the previous auction.
Investors staked N697.29 billion on N450 billion in 364-day Treasury bills that was offered for subscription. The CBN raised N636.46 billion from the longest tenor at the spot rate of 17.50%, up from 16.04% at the previous auction.
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