By Charles Pemu 
Washington D.C. — The International Monetary Fund (IMF) has strongly condemned Illicit Financial Flows (IFFs) out of Nigeria, identifying the menace as a primary contributor to the nation’s severe revenue problems.
Speaking at the ongoing 2025 Annual Meetings of the IMF and World Bank in Washington D.C., IMF Managing Director Ms. Kristalina Georgieva announced a renewed global focus on tracing these flows, with Nigeria being a key priority.
“We believe that for countries like Nigeria, the IMF’s renewed focus on tracing Illicit Financial Flows could provide a blueprint for plugging the fiscal leakages that have long undermined revenue generation and sustainable growth,” Georgieva stated.
The Growing Threat of Dirty Money
Ms. Georgieva warned that IFFs which include stolen public funds, proceeds from criminal activities, and untraceable digital transactions have become a major factor destabilizing global economic and financial systems. She noted that these flows “continue to erode governance systems, drain public resources, and cripple developmental efforts, especially in developing economies.”
IMF officials further highlighted the complexity introduced by the digital economy, noting that cryptocurrencies like Bitcoin provide a sophisticated, anonymous avenue for financial crimes.
“You may have money, just plainly stolen money that belongs to the taxpayers… Now with digital money, criminal activities can be funded without being traced. This is a serious problem, and we have to take it as such,” the IMF boss asserted.
In response to the growing threat, the IMF revealed that it has significantly strengthened its Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) framework following a comprehensive 2023 review.
Key measures in the IMF’s new strategy include:
- Compulsory Assessment: “Following the money has now become a compulsory part of the IMF’s annual Article IV consultations,” ensuring routine assessment of a member country’s exposure to illicit flows.
- Program Conditionality: For countries seeking IMF financial assistance, program design will now include specific, mandatory measures to address systemic illicit flows.
- Technical Assistance: The Fund is increasing support for member countries through training and technical assistance to enable local authorities to effectively detect, trace, and respond to suspicious financial activities.
Ms. Georgieva stressed that curbing IFFs requires more than just financial system checks; it demands strengthening the “very core of governance and institutional integrity.” She confirmed that the Governance Diagnostics initiative is actively helping countries identify structural weaknesses that enable corruption
Growth Outlook Upward to 3.9%
Despite the serious fiscal leakage problem, the IMF has issued a positive forecast for Nigeria’s economy, revising its 2025 economic growth outlook upward to 3.9 per cent.
This projection, which is a 0.5 percentage point increase from the IMF’s July 2025 update, and significantly higher than earlier April forecasts, was detailed in the October 2025 World Economic Outlook (WEO) titled “Global Economy in Flux.”
Denz Igan, Division Chief of the Research Department at the IMF, attributed Nigeria’s growth resilience to several factors:
- Stronger Fundamentals: Higher oil production and improved security in producing areas.
- Policy Impact: A more supportive fiscal stance, reforms in the energy and financial sectors, and exchange rate adjustments that have improved foreign exchange market transparency.
- Rebasing Impact: The upward revision also incorporates a major rebasing of Nigeria’s national accounts, which adopted 2019 as the new base year to capture previously underreported sectors like the digital economy and modular refining activities, effectively raising nominal GDP by over 40 per cent.
The IMF projects Nigeria’s real GDP to accelerate to 4.2 per cent in 2026. However, the Fund cautioned that inflation remains elevated, forecasting a slow decline in average consumer prices from 31.4 per cent in 2024 to 23.0 per cent in 2025. The IMF urged Nigeria to sustain credible fiscal and monetary policies and accelerate reforms to entrench macroeconomic stability.