The African Development Bank (AfDB) has restated the urgent need for Nigeria to close its annual development financing gap of $31.5 billion.
According to Dr. Abdul Kamara, AfDB’s Director-General for Nigeria, this is a crucial finding from the Bank’s 2025 Nigeria Country Focus Report.
The report highlights the need for a more strategic and coordinated approach to mobilizing and deploying Nigeria’s diverse capital resources, including fiscal, financial, human, natural, and business capital.
Despite recent economic reforms, Nigeria’s real GDP growth is projected to decline from 3.4% in 2024 to 3.2% in 2025 and 3.1% in 2026 due to persistent structural challenges and global uncertainties.
Domestic resource mobilization is critical to closing the financing gap, but Nigeria’s tax-to-GDP ratio remains among the lowest in the region.
To address this, the report recommends broadening the tax base,
Improving governance and investing in human capital.
The AfDB’s Country Economist for Nigeria, Peter Rasmussen, emphasized that strengthening non-oil revenue and improving public financial management will provide fiscal space to invest in people and infrastructure.
The report also highlights the importance of innovative financing options, such as diaspora bonds, blended finance, and green bonds, in bridging the development financing gap.
