Nigeria, despite being Africa's largest economy and most populous nation, faces several significant and interconnected economic challenges. These include:

• High Inflation and Currency Volatility: Inflation continues to be a major issue, often exceeding 20% and at times hitting 30%, significantly eroding the purchasing power of citizens. This is exacerbated by a depreciating naira, which makes imported goods more expensive. While recent reforms aim to stabilize the currency, volatility remains a concern for businesses and households.

• Oil Dependence and Lack of Diversification: Nigeria's economy is heavily reliant on oil exports, which account for a large proportion of government revenues (around 30% in 2024) and over 90% of export earnings. This makes the economy highly vulnerable to fluctuations in global oil prices. Despite efforts, true economic diversification has been limited, leaving other potentially strong sectors like agriculture and manufacturing underdeveloped.

• Poverty and Food Insecurity: Poverty rates remain high, with a significant portion of the population (estimated at 42-46% in 2023) living below the poverty line. Food insecurity is also a pressing concern, driven by factors like rising food prices, disruptions to agricultural activities (often due to insecurity), and inadequate infrastructure for storage and transport.

• Insecurity: Various forms of insecurity, including banditry, kidnappings, and insurgency in different regions, significantly disrupt economic activities, deter investment, and impact agricultural production and supply chains. Many businesses have had to reduce operations or relocate due to security concerns.

• Inadequate Infrastructure: Nigeria suffers from a significant infrastructure deficit, particularly in electricity, transportation (roads, bridges, ports), and storage. Frequent power outages force businesses to rely on expensive alternative power sources, increasing operational costs and hindering productivity. Poor transportation networks also impede trade and commerce.

• High Public Debt and Fiscal Strain: The government faces significant fiscal challenges, including budget deficits and a growing public debt. A large portion of government revenue is consumed by debt servicing, leaving limited funds for essential investments in infrastructure and human capital development.

• Unemployment and Underemployment: Unemployment rates are high, particularly among the youth. The economy has struggled to create enough productive jobs for the large number of people entering the workforce annually, leading to social and economic risks. Many workers are employed in low-productivity sectors.

• Corruption and Weak Governance: Corruption is a pervasive issue that undermines economic growth, discourages investment, and erodes public trust. Weak institutions and a lack of transparency and accountability also hinder effective economic management and policy implementation.

• Limited Access to Finance and Business Environment Challenges: Businesses, especially small and medium-sized enterprises (SMEs), often face difficulties in accessing finance. The overall business environment can be challenging due to regulatory uncertainty, bureaucracy, and issues related to land ownership.

While the Nigerian government has embarked on various reforms, addressing these deep-rooted challenges will require sustained effort, effective policy implementation, and a focus on creating a more stable, inclusive, and diversified economy.