Nigeria's economy has suffered a severe decline over the past decade, with GDP per capita falling by 72.35%, according to recent data from the International Monetary Fund (IMF).
The figures reveal a sharp drop in GDP per capita, which stood at $3,022 in 2014 but has now dwindled to $835.49 in 2024. This decline underscores a significant reduction in the average economic output per citizen.
Additionally, Nigeria's total Gross Domestic Product (GDP) has contracted dramatically, plummeting from $568.5 billion in 2014 to $194.96 billion in 2024, marking a 65.71% reduction in the country's overall economic activity.
Slower Economic Growth and Rising Inflation
Beyond the fall in economic output, Nigeria's real GDP growth rate has also taken a hit. In 2014, the country recorded a 6.3% growth rate, but by 2024, this figure had dropped to 2.9%, signaling sluggish economic expansion.
Economic difficulties have worsened due to policy changes introduced in 2023 under President Bola Tinubu. The removal of fuel subsidies led to a sharp rise in petrol prices, causing inflation to spike to 34.8% in December 2024.
At the same time, the devaluation of the naira further weakened purchasing power, escalating the cost of imported goods and adding to inflationary pressures.
Nigeria's challenges have been compounded by its inability to meet crude oil production targets set by OPEC, which has restricted its foreign exchange earnings and put additional strain on government revenue.
Economic Experts Warn of Continued Decline
Despite government assurances of economic stabilization, financial analysts argue that key indicators suggest otherwise.
"The perception of economic recovery is misleading," said Marcel Okeke, former Chief Economist at Zenith Bank.
"Inflation has surged from 22.4% in May 2023 to 34.8% in December 2024. How can we talk about progress when purchasing power continues to shrink?"
Okeke also pointed out the massive depreciation of the naira, which fell from ₦500/$1 in May 2023 to a range of ₦1,000 – ₦1,500/$1 in 2024, despite various government interventions.
"Fuel prices have skyrocketed, rising from ₦200 per litre to nearly ₦1,000 per litre. These realities confirm that the economy remains in decline," he added.
Nigerians Struggle with High Cost of Living
While the National Bureau of Statistics (NBS) has announced plans to rebase GDP and the Consumer Price Index by early 2025, Okeke cautioned that such measures might be used to create a false impression of improvement.
"Statistical adjustments might paint a brighter picture, but on the ground, unemployment is rising, and salaries have lost value," he explained.
He also criticized the ineffectiveness of increased government revenue allocations, arguing that they have not led to better living conditions.
"A 50kg bag of cement that cost ₦2,000 – ₦3,000 a few years ago now sells for ₦9,000 – ₦10,000. Increased government spending hasn't improved affordability for the people," Okeke emphasized.
Oil Sector Struggles Amid Structural Issues
As Nigeria's largest foreign exchange earner, crude oil accounts for over 90% of total export revenue. However, the country has faced setbacks in meeting its OPEC production targets due to challenges such as pipeline vandalism and underinvestment in infrastructure.
OPEC reports indicate that Nigeria's crude oil output hit 1.53 million barrels per day (bpd) in January 2025, meeting its production quota for the first time since November 2023.
Despite this temporary success, energy analysts warn that long-term stability remains uncertain due to persistent structural issues.
Calls for Policy Reforms to Revive Growth
Development economist Aliyu Ilias attributed the country's low GDP per capita to the continued depreciation of the naira, which has fallen from ₦300/$1 to over ₦1,500/$1.
"Economic indicators do not suggest any real improvement," Ilias stated.
He further noted that Nigeria's 2025 budget, when converted to US dollars, is lower than the 2024 budget, highlighting the government's growing financial constraints.
To reverse the downward trend, Ilias outlined key policy measures, including:
✔ Strengthening domestic production
✔ Balancing trade deficits
✔ Enhancing national security
✔ Boosting food and energy security
"Without tackling these core economic challenges, GDP growth will remain sluggish, and per capita income will continue to drop," he warned.
As Nigeria faces its most severe economic crisis in a decade, experts stress the urgency of implementing effective reforms to prevent further decline and improve the standard of living for millions of citizens.
