After a thorough review of economic indices from African countries, the International Monetary Fund (IMF) has disclosed that Nigeria may become Africa’s third-largest economy, edging out Algeria from the position in 2026.
The financial institution stated that the West African nation’s sharp turnaround would be driven by ongoing policy adjustments embarked on by the President Bola Tinubu administration, which has started improving output levels, and renewed optimism around medium-term growth prospects.
Recent international economic projections indicate that Nigeria’s position on the continent’s economic ranking is expected to strengthen after several years of volatility linked to currency pressures, macroeconomic headwinds, and shifts in global commodity markets.
The anticipated improvement follows a period in which Nigeria trailed behind South Africa, Egypt, and Algeria, as exchange rate movements and weaker output constrained the dollar value of its overall economic size.
According to figures contained in the IMF’s World Economic Outlook released in October 2025 and obtained yesterday, Nigeria, ranked fourth in Africa in 2025 with a gross domestic product estimated at $285 billion at current prices, is expected to move up the ladder.
The IMF data showed South Africa leading the continent with roughly $426 billion, followed by Egypt at $349 billion, while Algeria occupied third place with an estimated economic size of $288 billion during the same period.
Projections for 2026, however, suggest Nigeria’s GDP will climb to approximately $334 billion, overtaking Algeria’s forecast output of about $284 billion and placing Nigeria behind only South Africa and Egypt, with projected GDPs of $443 billion and $399 billion, respectively.
The IMF linked Nigeria’s projected rebound to expectations of higher crude oil production, improved foreign exchange liquidity, and the cumulative impact of recent economic reforms, despite lingering short-term inflationary pressures.
In separate assessments released in January, both the IMF and the World Bank revised Nigeria’s 2026 growth outlook upward to 4.4 per cent, reinforcing expectations that ongoing fiscal and exchange rate reforms could support stronger expansion.
