The International Monetary Fund (IMF) has expressed concern over rising Illicit Financial Flows (IFFs) from Nigeria, warning that the trend is worsening the country’s revenue challenges.
IMF Managing Director, Kristalina Georgieva, made this known at the 2025 Annual Meetings of the IMF and World Bank in Washington, D.C. She said the Fund is intensifying efforts to trace such flows as part of its renewed strategy to plug fiscal leakages.
“For countries like Nigeria, tracing illicit financial flows can provide a blueprint for closing fiscal gaps that undermine sustainable growth,” Georgieva stated.
IFFs, she explained, include stolen public funds, proceeds from crime, and untraceable digital transactions — all of which weaken governance, drain public resources, and slow development. The rise of cryptocurrencies has also made tracking such transactions more complex.
To address this, the IMF has strengthened its Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) framework. Monitoring illicit flows is now a core part of its annual country assessments. Georgieva emphasized that fighting IFFs requires stronger institutions, transparency, and collaboration among governments, civil society, and international partners.
“Curbing illicit flows goes to the heart of governance and institutional integrity,” she added.
In a positive turn, the IMF has revised Nigeria’s 2025 economic growth forecast upward to 3.9%, citing improved investor confidence, stronger oil production, and supportive fiscal policies. Growth is expected to accelerate further to 4.2% in 2026.
Inflation, though still high, is projected to ease from 31.4% in 2024 to 23% in 2025 as fiscal reforms and exchange rate adjustments take effect.
The IMF also noted that Nigeria’s recent GDP rebasing which now captures the digital economy and informal sectors boosted nominal GDP by over 40%.
Despite the optimism, the Fund urged Nigeria to sustain reforms, strengthen governance, and build resilience against illicit financial activities.
Bottom Line:
Nigeria’s economy is showing renewed strength, but the battle against illicit financial flows remains critical to ensuring that growth translates into real development and fiscal stability.
