The Independent Media and Policy Initiative (IMPI), a Nigerian policy think tank, says new tax laws and improving macroeconomic stability could help lift Nigeria’s economy by at least 5.5 percent in 2026.
In a policy statement signed by its Chairman, Dr Omoniyi Akinsiju, IMPI argued that 2026 could turn out to be a strong year for Africa’s most populous country because the federal administration has continued with reforms that began in 2023, even after early economic pressures.
IMPI said it expects the reforms to translate into stronger growth, adding that it based its projection on what it described as a better managed economy since the reform process started. The group also said it was encouraged that the Federal Government maintained its approach despite the initial “headwinds” it linked to the economy adjusting to the impact of the reforms.
A major part of IMPI’s optimism is tied to Nigeria’s tax reforms, which it said took effect on Thursday, 1 January 2026. The think tank said the changes are expected to improve tax mobilisation and strengthen revenue across the federation through phased implementation, tighter enforcement of compliance, wider use of digital revenue systems, and improved remittance discipline among revenue-generating agencies.
IMPI also said the tax reforms are expected to reshape how manufacturers operate, invest, and plan for growth. According to the group, the laws signal a policy shift toward a more coordinated and incentive-driven fiscal environment, particularly for the manufacturing sector.
At the centre of the reforms, IMPI said, are newly introduced Economic Development Tax Incentives aimed at priority sectors such as manufacturing. Under the scheme, eligible companies can obtain an Economic Development Incentive Certificate, which grants a five percent annual tax credit on qualifying capital expenditure for up to five years. IMPI added that firms that reinvest profits may qualify for longer incentive periods, while some manufacturing-related transactions are exempt from stamp duties.
Beyond tax policy, IMPI pointed to rising capital acquisition by private sector operators as another sign it expects the economy to expand. It said Nigerian companies, especially in the oil, gas, telecommunications, banking, industrial goods, and agricultural sectors, have been buying more property, plant, and equipment in recent years to increase capacity and strengthen their market positions.
As examples, IMPI highlighted major 2025 transactions, including MTN Nigeria Communications Plc, a leading telecommunications operator in Nigeria, which it said recorded ₦539.6 billion in capital acquisition. It also cited Presco Plc’s acquisition of a 10,000-hectare plantation in Cross River State, a coastal state in southern Nigeria, and Ellah Lakes Plc’s acquisition of more than 11,700 hectares of land across four Nigerian states, among others.
IMPI said such large-scale investments are aimed at increasing production capacity to meet consumer demand and reduce dependence on imports, with direct consequences for output.
The group also pointed to developments in foreign exchange access. It said Nigeria moved up 15 places to fourth in Africa for foreign exchange accessibility in the Absa Africa Financial Markets Index 2025, a ranking published by Absa Group, a major Africa-focused bank headquartered in South Africa. IMPI described foreign exchange accessibility as an important factor for the ease of doing business, especially for foreign direct investors who need to access and repatriate currency reliably.
According to IMPI, Nigeria’s improvement in this area reflects sweeping foreign exchange reforms by the Central Bank of Nigeria (CBN), the country’s apex bank. It added that financial account trends also supported the broader economic outlook, noting that Foreign Direct Investment (FDI) inflows rose to $720 million in the third quarter of 2025, while portfolio investment reached $2.51 billion, signalling stronger participation by non-resident investors in Nigeria’s domestic debt and equity markets.
On that basis, IMPI said it expects foreign direct investment to rise further in 2026 alongside increased access to foreign exchange.
The think tank also projected that macroeconomic stability would continue and help support stronger manufacturing output. It described macroeconomic stability as a key foundation for private sector development and economic growth, and said research comparing many countries has often found that growth, investment, and productivity tend to rise when economic relationships are in balance. It said those relationships include the alignment between domestic demand and output, the balance of payments, fiscal revenues and expenditure, and savings and investment.