Can Nigeria hit a 7% growth target by 2027? — what the numbers and experts say

By Ephraim Agbo 

In August 2025 President Bola Ahmed Tinubu set a bold economic goal: raise Nigeria’s annual growth rate to 7% by 2027, with an even more ambitious aspiration to quadruple the economy by 2030. The headline is inspiring — but is it realistic? Kingsley Moghalu, former Deputy Governor of the Central Bank of Nigeria and president of the Institute for Governance & Economic Transformation (IGET Africa), gives a blunt prescription: “electricity is the secret sauce.” Below I unpack the policy context, the constraints, and a practical assessment of whether a 7% path is feasible — and what it would mean for ordinary Nigerians.

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The context: why Tinubu is aiming high

Tinubu’s target responds to a painful political and economic moment. Since his administration began major reforms (fuel and some electricity subsidy removals, naira revaluation and other macro moves), Nigeria has experienced severe cost-of-living shocks even while the government argues these steps are needed to restore fiscal health and attract investment. The 7% goal is framed as a poverty-reduction and growth-acceleration objective — but independent forecasters (including multilateral forecasts) are more cautious.

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Electricity: Moghalu’s central claim and the evidence behind it

Moghalu’s central point is straightforward: reliable, affordable power unlocks manufacturing, reduces the cost of doing business, and multiplies productive jobs. He’s not alone — World Bank and development practitioners repeatedly flag power as a binding constraint for Nigeria’s competitiveness. Nigeria still has a very large unelectrified population: estimates put tens of millions of people without reliable grid power (roughly 40–45% of the population lack regular access depending on the source and metric). That shortfall forces businesses onto diesel generators and households onto costly mini-systems — a huge drag on productivity.

Bottom line: Moghalu is right that power is a make-or-break factor. But electricity alone won’t deliver 7% growth unless it arrives with complementary reforms (finance, logistics, security, and governance).

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Fiscal priorities: what the budget says about direction

If growth is to be inclusive, public spending has to back human capital and safety nets. The 2025 federal budget figures illustrate the tension:

• Education in the 2025 budget was allocated about N3.52 trillion, roughly 7% of the federal budget — a figure that many unions and education experts say is still well below international recommendations.
• Social welfare programs were budgeted at roughly N723.68 billion in the 2025 documents. Against an approved federal budget in the ~N54.99 trillion range, that social-welfare allocation represents only about 1.3% of the budget — a very small share for cushioning citizens from shocks like subsidy removal.

These allocations matter because removing subsidies frees up fiscal space only if the savings are redirected to productive investment and social protection. Critics ask: where are those gains going, and who is benefiting?

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Four structural barriers to hitting 7% quickly

Even with a serious push on power, Nigeria faces four deep constraints that make immediate 7% growth a stretch:

1. Governance and implementation capacity. Large projects require predictable institutions, transparent procurement, and maintenance capability. Without that, projects stall or become rent sources.
2. Investment shortfall. Public investment in recent years has been low as a share of GDP; private investors need better risk-sharing and currency stability.
3. Human capital gaps. Education and health underinvestment blunt productivity gains even if factories get power. The current budget allocations show the gulf between rhetoric and needed human-capital investment.
4. Fragile social compact. Rapid reforms (subsidy removals, currency shifts) without timely, visible social cushions can erode public support and political stability — itself a brake on investment.

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Practical policy checklist (what must happen next)

If the government truly wants to make 7% by 2027 more than a slogan, it needs a coordinated program covering at least these items:

• Fast-track electrification with smart targeting. Prioritise industrial corridors and cluster electrification (grid + mini-grids + large distributed solar for manufacturers), paired with concessional finance and private-sector guarantees. (Moghalu’s electricity point fits here.)
• Protect the most vulnerable: use part of subsidy savings to scale up cash transfers and public works (well-targeted, time-bound) so households can survive adjustment while productivity catches up.
• Boost public investment efficiency: clear sovereign guarantees, transparent procurement, and maintenance budgets — not just capital spending.
• Ease business costs beyond power: logistics, ports, customs reform, and trade facilitation to turn electricity gains into export-capable industry.
• Human capital catch-up: a real plan to lift education and health spending toward international norms with measurable outcomes (teachers, learning, health coverage).

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So — is Kingsley Moghalu right?

Short answer: partly and importantly so. Electricity is indeed one of Nigeria’s single biggest binding constraints; fix it and you unlock productivity across manufacturing, services, and agriculture. but — and this is crucial — electricity is a necessary condition, not a sufficient one. Without parallel gains in governance, public investment efficiency, human capital, and social protection, increased power supply will deliver much less than it could.

Moghalu correctly focuses attention on the structural lever that often gets overlooked in political debates. But to turn that lever into 7% growth by 2027 requires exceptionally fast, well-funded, and well-governed execution — plus time for private activity to respond. Given the scale of reforms already underway and the political economy risks of rapid adjustment, the target is ambitious — achievable in principle, but very challenging in practice.

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Final verdict

• Short term (12–24 months): Expect modest gains if the government accelerates electrification projects and channels subsidy savings to visible projects and transfers. Political resistance or weak implementation will blunt impact.
• Medium term (3–5 years): Structural change (industrial revival, jobs) is possible — but only with coherent public-private partnerships, improved governance, and sustained investment in people.
• Watch these indicators: nationwide electricity access rates, industrial output in priority corridors, the share of budget going to social protection and education, and private-sector investment flows.