The International Monetary Fund (IMF), in its July 2026 assessment, has warned that rising prices of essential commodities could worsen poverty and food insecurity in Nigeria despite improvements in the country’s macroeconomic outlook. While acknowledging that recent economic reforms have strengthened fiscal stability and improved growth prospects, the Fund cautioned that the benefits of these reforms may not reach ordinary Nigerians if the cost of food and other basic necessities continues to rise.
The warning comes at a time when many households are struggling with persistent inflation, rising transportation costs and declining purchasing power. Although Nigeria’s economy is projected to grow by 4.1 percent in 2026, the IMF argued that sustained increases in the prices of food, fuel and other essential goods could undermine living standards and widen existing social inequalities.
Experts who spoke with Business Times agreed with the IMF’s assessment, describing the warning as a reflection of the realities facing millions of Nigerians. A policy maker, Adedipe Adeyeye, said rising food prices directly increase poverty because they weaken the purchasing power of households. According to him, when the prices of essential goods increase without a corresponding rise in wages, families are forced to spend most of their income on food, leaving little for healthcare, education and housing. He added that the situation also affects the nutritional quality of meals as households are compelled to reduce both the quantity and quality of food consumed, increasing the risk of malnutrition, particularly among children and other vulnerable groups.
Another policy expert, Lydia Adeleke Abiodun, also agreed with the IMF’s position. She noted that rising prices have forced many companies to reduce their workforce, while others are unable to increase salaries despite the rising cost of living. As a result, many workers can no longer meet their financial obligations because wages have remained largely stagnant while the prices of essential commodities continue to rise. The IMF similarly warned that poverty and food insecurity remain significant concerns across Sub Saharan Africa, adding that vulnerable households are likely to bear the greatest burden because they spend a larger proportion of their income on food and other necessities.
Analysts identified several factors driving the continued increase in commodity prices in Nigeria. Adeyeye attributed the trend to the removal of fuel subsidy, fluctuations in global oil prices and persistent insecurity in major farming communities. He explained that higher petrol and diesel prices have significantly increased transportation and distribution costs, making it more expensive to move agricultural produce from farms to markets. He also said insecurity has disrupted farming activities, reduced crop yields and displaced farming communities, resulting in lower food supply.
Abiodun pointed to unreliable electricity supply, rising electricity tariffs, expensive diesel and increasing costs of machinery and equipment as additional factors raising production costs for businesses. According to her, manufacturers and producers are compelled to transfer these higher operating costs to consumers through increased prices. The long term implications, according to experts, extend beyond household hardship. Adeyeye observed that when food prices rise because of inflation, currency depreciation and supply chain disruptions rather than improved agricultural productivity, purchasing power declines, poverty deepens and economic growth slows. However, he argued that high prices can also encourage greater domestic production if supported by appropriate government policies. Increased investment in agriculture, he said, could improve food security, reduce dependence on imports and strengthen rural economies over time. Abiodun added that rising food prices reduce workers’ productivity because many families cannot afford adequate nutrition. She warned that poor nutrition ultimately weakens the country’s labour force and affects overall economic performance.
For many Nigerians, however, the economic debate has become a daily struggle for survival.Faith Samuel, a sales associate, said the rising cost of living has fundamentally changed household spending patterns.
“Everything is just expensive now. The money you used to buy a few things before does not even go far anymore, so I have to be more careful with how I spend,” she said.
According to Samuel, staple foods including rice, beans, eggs, cooking oil, tomatoes and pepper have become increasingly difficult to afford, while even toiletries now consume a larger share of household income. She said she now buys many items less frequently because of the persistent price increases. Similarly, Martha Eje, a nurse, said many families have adjusted by purchasing food in smaller quantities, cutting unnecessary expenses and choosing cheaper alternatives.
“We are managing by buying food in smaller quantities and postponing buying certain things until we have enough money,” she said.
Eje added that many Nigerians can no longer afford three meals a day because incomes have remained relatively unchanged while food prices continue to increase. A teacher, Omobolaji Alabi, described the IMF’s warning as a confirmation of what ordinary Nigerians already experience every day. “When you spend almost all your salary on food and transport, nothing is left for rent, school fees or healthcare,” he said. “Poverty is no longer a future risk. Many families are already living through it.”On policy solutions, experts maintained that improving food production and reducing production costs should be a priority.
Adeyeye called for strict enforcement of import duty waivers on staple foods, fertilisers, seeds and manufacturing inputs. He also urged the government to improve security in farming communities and invest in post harvest storage facilities to reduce food losses and stabilise supply. To increase domestic food production, he recommended subsidising agricultural inputs, rehabilitating rural roads and expanding irrigation infrastructure to enable year round farming. Abiodun also stressed the need for government support for farmers through the provision of equipment, farming materials and better road infrastructure to facilitate the movement of produce to markets.
On protecting vulnerable households, Adeyeye advocated targeted cash transfers, temporary food subsidies and the development of stronger social protection systems. He argued that long term economic stability would require sustained investment in education, skills development, employment creation and sound fiscal management.
Abiodun recommended vocational training programmes, business grants and temporary financial support for struggling households to help them build sustainable sources of income. The IMF’s July assessment highlights the growing disconnect between macroeconomic progress and the realities faced by many Nigerians. While reforms have improved economic fundamentals, rising prices continue to erode household incomes and threaten food security.
Experts argue that unless policies focus on expanding agricultural production, reducing production costs and protecting vulnerable households, the country’s economic recovery may remain largely disconnected from the everyday realities of its citizens.
