IMF tips Nigeria to become Africa’s third-largest economy by 2026 with GDP of $334 billion

The International Monetary Fund (IMF) has projected that Nigeria could become Africa’s third-largest economy by 2026, with its Gross Domestic Product (GDP) expected to reach $334 billion, overtaking Algeria.

According to the IMF’s World Economic Outlook (October 2025), Nigeria ranked fourth in Africa in 2025 with a GDP of about $285 billion, behind South Africa, Egypt, and Algeria.

The fund attributed Nigeria’s anticipated rise to increased oil production, improved foreign exchange liquidity, and ongoing economic reforms, including fuel subsidy removal, exchanged-rate liberalization, and fiscal adjustments.

These measures, the IMF said, are aimed at supporting medium-term growth despite short-term inflationary pressures. Algeria’s GDP is projected at $284 billion in 2026, placing it behind Nigeria if current trends continue.

South Africa is expected to remain Africa’s largest economy with a projected GDP of $443 billion on 2026, followed by Egypt at $339 billion.

In 2025, South Africa led with $426 billion, Egypt followed with $349 billion, while Algeria ranked third at $288 billion.

Nigeria’s economic ranking has fluctuated in recent years due to currency devaluation, GDP rebasing, and wider macroeconomic challenges. However, the IMF recently revised Nigeria’s 2026 growth forecast upward to 4.4 percent from 4.2 percent. The world Bank also raised its projection to 4.4 percent up from 3.7 percent in mid-2025.

The IMF further projected that Nigeria would contribute 1.5 percent to global real GDP growth in 2026, ranking among the top contributors worldwide. China is expected to remain the largest contributor at 26.6 percent and percent, followed by India at 17 percent and the United States at 9. 9 percent.

Reacting to the report, Tesla Chief Executive Elon Musk said, “The balance of power is changing”.

Despite ongoing domestic and global challenges, analysts note that Nigeria’s consumption-driven growth continues to support expansion in energy, services, telecommunications, and trade, strengthening its position among emerging economies.

-9News Nigeria.