Nigeria has earned cautious praise from the International Monetary Fund for sweeping economic reforms, even as the global lender raised concerns over a proposed $5 billion derivatives transaction that it says could pose significant fiscal risks.
In its June 9 Article IV consultation, the IMF said Nigeria has made notable progress by scrapping fuel subsidies, liberalising its foreign exchange market, and improving revenue mobilisation, moves that have helped stabilise the economy and rebuild investor confidence.
The Fund noted that these reforms have narrowed the gap between official and parallel market exchange rates, with the premium falling below 5 percent in recent months. This, it said, signals growing trust in the country’s monetary framework after years of currency distortions.
Economic growth is expected to strengthen further, with projections placing Nigeria’s medium-term expansion above 4 percent. The IMF also pointed to improving macroeconomic fundamentals, including rising foreign reserves and a declining debt-to-GDP ratio, suggesting that recent policy shifts are beginning to yield tangible results.
However, the report struck a more cautious tone regarding a planned $5 billion total return swap agreement involving First Abu Dhabi Bank. The IMF described the arrangement as “opaque and risky,” warning that such instruments can expose countries to sudden financial pressures, particularly through margin calls that may arise if market conditions shift unfavourably.
“While innovative financing tools can provide short-term liquidity, they must be approached with transparency and robust risk management,” the Fund said, urging Nigerian authorities to carefully assess potential liabilities tied to the deal.
Nigeria’s Finance Minister, Wale Edun Oyedele, welcomed the IMF’s largely positive assessment, describing it as validation of the government’s reform agenda. He defended the administration’s policies, noting that difficult decisions, such as ending fuel subsidies, were necessary to stabilise public finances and set the economy on a sustainable path.
At the same time, concerns persist over Nigeria’s rising debt profile, which the report estimates at around $111 billion. Although the IMF acknowledged that debt remains manageable relative to GDP, it stressed the importance of prudent borrowing and fiscal discipline to avoid future vulnerabilities.
Analysts say the IMF’s mixed assessment reflects a broader reality: Nigeria’s reforms have begun to restore confidence, but the path forward will require careful balancing of innovation and caution in financial management.
Looking ahead, the IMF urged authorities to deepen structural reforms, enhance transparency, and prioritise inclusive growth to ensure that recent gains translate into long-term economic stability.
PRESS RELEASE
— Taiwo Oyedele (@taiwoyedele) June 9, 2026
𝐓𝐇𝐄 𝐅𝐄𝐃𝐄𝐑𝐀𝐋 𝐆𝐎𝐕𝐄𝐑𝐍𝐌𝐄𝐍𝐓 𝐍𝐎𝐓𝐄𝐒 𝐈𝐌𝐅 𝐀𝐒𝐒𝐄𝐒𝐒𝐌𝐄𝐍𝐓 𝐎𝐅 𝐍𝐈𝐆𝐄𝐑𝐈𝐀'𝐒 𝐄𝐂𝐎𝐍𝐎𝐌𝐘 𝐀𝐍𝐃 𝐑𝐄𝐌𝐀𝐈𝐍𝐒 𝐂𝐎𝐌𝐌𝐈𝐓𝐓𝐄𝐃 𝐓𝐎 𝐒𝐔𝐒𝐓𝐀𝐈𝐍𝐈𝐍𝐆 𝐑𝐄𝐅𝐎𝐑𝐌𝐒 𝐌𝐎𝐌𝐄𝐍𝐓𝐔𝐌
Abuja, 9 June 2026
The Federal Government…