By Staff Investigations Desk
Despite a sharp slowdown in inflation, more Nigerians fell into poverty in 2025, exposing the limited impact of recent macroeconomic gains on household welfare and raising fresh questions over whether economic reforms are translating into real relief for families.
The World Bank said in its latest Nigeria Development Update that the country’s poverty rate rose to 63 per cent in 2025, up from 61 per cent in 2024 and 56 per cent in 2023, pushing an estimated 140 million people below the poverty line.
The increase came even as headline inflation dropped significantly over the same period, creating a stark disconnect between improving macroeconomic indicators and worsening living standards.
According to the National Bureau of Statistics, headline inflation slowed from 34.80 per cent in December 2024 to 15.15 per cent in December 2025, while food inflation fell from 39.84 per cent to 10.84 per cent. Yet the World Bank said the moderation came too late to reverse the damage already done to household purchasing power.
“Household incomes have not grown fast enough to offset still-elevated inflation, and poverty has yet to begin declining,” the bank said.
The findings underscore a central challenge facing Nigeria’s reform programme: stabilising prices does not automatically restore lost welfare, particularly after a prolonged period of high food, transport and energy costs.
Economists say the latest figures point to deeper structural weaknesses in the economy, especially weak job creation and the poor performance of agriculture, the sector employing more than half of Nigerians living in poverty.
The World Bank noted that while services and industry have driven much of recent growth, agriculture has lagged, limiting income gains for the country’s most vulnerable households.
This imbalance has left many rural and low-income families unable to benefit from broader economic expansion, even as inflation pressures begin to ease.
Finance Minister Wale Edun said the government’s reforms remain focused on lifting millions out of poverty through investment-led growth, job creation and targeted support for vulnerable households.
He said digital direct-benefit transfers linked to national identity systems were being used to cushion the poorest Nigerians from the effects of higher living costs, adding that social safety nets would remain a permanent feature of government policy.
But the latest poverty figures are likely to intensify scrutiny of how effectively those interventions are reaching intended beneficiaries, especially in rural communities where food costs and weak farm productivity continue to weigh heavily on incomes.
The World Bank expects poverty to begin easing gradually from 2026 as inflation continues to slow, projecting a decline to about 59 per cent by 2028. However, it warned that progress would remain slow unless growth becomes more inclusive and generates more productive jobs.
For millions of households, the data suggests the economic recovery remains largely statistical.
While inflation may be slowing on paper, the lived reality for many families is that wages, farm earnings and informal incomes have yet to recover enough to restore lost purchasing power.
That gap between stabilising numbers and persistent hardship is now emerging as the clearest test of whether Nigeria’s reforms can deliver tangible improvements in everyday life.