World Bank keeps Nigeria in lower-middle-income group despite reforms

The World Bank has retained Nigeria’s classification as a lower-middle-income economy for the 2027 fiscal year, keeping Africa’s most populous economy in the same income bracket it has occupied since 2010 despite ongoing economic reforms aimed at lifting growth and improving productivity.

 

In its latest income classification update, the Washington-based lender placed Nigeria among economies with a gross national income (GNI) per capita of between $1, 176 and $4,635.

 

The classification is based on countries’ 2025 GNI per capita calculated using the World Bank’s Atlas method, which applies a three-year average of exchange rates to reduce the impact of currency fluctuations and improve cross-country comparisons.

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The annual income classifications are widely used by development institutions, investors and policymakers to assess countries’ levels of economic development, determine eligibility for concessional financing and compare income levels across economies.

 

According to the World Bank, low-income economies are those with a GNI per capita of $1,175 or less, while lower-middle-income economies have a GNI per capita ranging from $1,176 to $4,635. Upper-middle-income economies have a GNI per capita of between $4,636 and $14,375, while high-income economies have a GNI per capita exceeding $14,375.

 

“The updated thresholds apply to FY27 and are based on countries’ 2025 GNI per capita calculated using the Atlas method,” the World Bank said in the report. “The Atlas method smooths exchange rate fluctuations by using a three-year average, allowing for more consistent cross-country comparisons.”

 

Nigeria also retained its status as a “blend country,” making it eligible to access financing from both the International Development Association (IDA), which provides concessional loans and grants to poorer countries, and the International Bank for Reconstruction and Development (IBRD), which lends to middle-income economies.

 

The country has remained in the lower-middle-income category since moving up from low-income status in 2010.

 

Successive governments have sought to raise Nigeria into the upper-middle-income bracket by expanding non-oil exports, improving productivity and strengthening macroeconomic stability.

 

President Bola Tinubu’s administration has implemented sweeping economic reforms over the past two years, including the removal of petrol subsidies, liberalisation of the foreign exchange market and fiscal measures intended to improve public finances and attract investment – although they have also contributed to higher inflation and increased cost-of-living pressures.

 

The government’s reform agenda has been aimed at strengthening macroeconomic stability and laying the foundation for faster long-term growth, but the latest classification suggests those efforts have yet to translate into a higher income category.

 

Across Africa, the latest World Bank update reflected mixed changes in countries’ income classifications.

 

Cabo Verde advanced from lower-middle-income to upper-middle-income status, while Togo moved from the low-income group to the lower-middle-income category.

“Several economies experienced changes in income classification this year, with Cabo Verde moving to the upper-middle-income category and Togo graduating to lower-middle-income status,” the World Bank said.

 

Ghana, Kenya, Côte d’Ivoire, Senegal, Cameroon, Angola and Zambia remained in the lower-middle-income category alongside Nigeria.

 

Namibia, however, moved in the opposite direction after being reclassified from an upper-middle-income economy to the lower-middle-income group.

 

South Africa, Botswana, Mauritius, Gabon, Equatorial Guinea and Cabo Verde are now classified as Africa’s upper-middle-income economies, while Seychelles remains the continent’s only high-income economy.

“The income classification is updated annually and serves as an important tool for operational and analytical purposes,” the World Bank said. “It is used by development institutions, policymakers and researchers to inform financing decisions, monitor development progress and facilitate cross-country comparisons.”