Nigeria to overtake Algeria as Africa’s third-largest economy in 2026 – IMF

Nigeria ranked as Africa’s fourth-largest economy in 2025, but is projected to climb to third position in 2026, according to data from the International Monetary Fund (IMF).

Data from the IMF’s World Economic Outlook (October 2025 edition), accessed via the Fund’s datamapper, showed Nigeria’s gross domestic product (GDP) at current prices stood at about $285 billion in 2025, placing it behind South Africa, Egypt and Algeria.

South Africa topped the African ranking with a GDP of about $426 billion, followed by Egypt at $349 billion, while Algeria ranked third with $288 billion.

However, the IMF forecasts that Nigeria will overtake Algeria in 2026 as economic output rebounds, driven by higher oil production, improved foreign exchange liquidity and the impact of ongoing economic reforms.

According to the IMF’s projections, Nigeria’s GDP is expected to rise to $334 billion, putting it ahead of Algeria ($284 billion) and making it Africa’s third-largest economy, behind South Africa ($443 billion) and Egypt ($399 billion).

The Fund’s outlook reflects expectations that recent reforms, including petrol subsidy removal, exchange-rate liberalisation and fiscal adjustments, will support medium-term growth, despite short-term inflationary pressures.

Africa’s largest economy’s position has shifted in recent years amid currency devaluations, rebasing exercises and macroeconomic headwinds across major economies on the continent.

On January 19, the IMF reviewed its forecast for Nigeria’s economic growth rate upward to 4.4 percent in 2026.

The Bretton Woods organisation revised the rate upward from its initial projection of 4.2 percent.

On January 13, the World Bank also increased its projection for Nigeria’s economic growth rate for 2026 to 4.4 percent from the 3.7 percent forecast in June 2025.(the Cable)