Mastercard Economics Institute’s 2025 Economic Outlook for…

The Mastercard Economics Institute’s 2025 Economic Outlook for Nigeria forecasts a GDP growth of 2.9% and a 6% increase in consumer spending, while inflation is expected to ease to 22.1%. The report emphasizes the importance of remittances, digital payments, and consumer behavior under economic pressures, reflecting a focus on financial inclusion and resilience in Nigeria’s economy.

The Mastercard Economics Institute has released its 2025 Economic Outlook for Nigeria, forecasting a year of change. The report anticipates Nigeria’s GDP growth at 2.9%, slightly trailing the global average of 3.2%. Estimated consumer spending is set to rise by 6%, even as consumer price inflation is expected to decelerate to 22.1%, presenting ongoing challenges for households and businesses alike.

Economic growth in Nigeria is largely underpinned by substantial remittance inflows, which bolster household incomes and stimulate consumption. Despite global economic challenges, Nigeria showcases resilience by utilizing its human capital and remittance systems to adapt to its economic landscape.

Khatija Haque, Chief Economist for EEMEA at Mastercard, stated, “Nigeria’s economic outlook for 2025 highlights the country’s resilience and potential for growth, driven by remittance inflows and consumer spending. These trends underscore the importance of fostering financial inclusion and addressing inflationary pressures to support sustainable development.”

Folasade Femi-Lawal, Country Manager and Area Business Head for West Africa, remarked, “Remittances play a pivotal role in driving economic resilience, and Mastercard Nigeria is committed to enhancing contactless payment solutions to simplify transactions, boost security, and reduce costs. Our efforts aim to foster an inclusive financial ecosystem, ensuring seamless, secure payments that support Nigeria’s vibrant economy.”

The report notes significant inflationary pressures on consumers globally, exacerbated by the pandemic and geopolitical tensions. Even though inflation in Nigeria is projected to moderate in 2025, it remains a critical challenge, prompting households to concentrate on essential goods over discretionary spending due to high inflation.

Migration trends have also shifted the economic landscape, where capital movement results in significant remittances that provide essential support for low- and middle-income communities. The World Bank has indicated that worldwide remittances rose from $128 billion in 2000 to $857 billion in 2023, predicting a 3% growth through 2025 supported by economic recovery and necessary local reforms. In Nigeria, the rise of digital payment methods is crucial for enhancing remittance efficiency and securing access to financial services for underserved populations.

The insights of the 2025 Economic Outlook are derived from diverse public and proprietary datasets, including aggregated Mastercard sales activity and economic activity models.

Mastercard continues to advance economic empowerment and digital payment solutions across over 200 countries, emphasizing a commitment to fostering an accessible and sustainable financial ecosystem.

In conclusion, the Mastercard Economics Institute’s 2025 Economic Outlook presents a nuanced picture of Nigeria’s economic environment, characterized by moderate GDP growth, increasing consumer spending, and substantial remittance inflows. The emphasis on digital payments and migration highlights opportunities for economic resilience, although inflation remains a persistent challenge. Overall, strengthening financial inclusion is crucial for fostering a sustainable economy.

Original Source: www.mastercard.com