Nigeria’s economy is showing signs of stability despite lacking an active International Monetary Fund (IMF) program, while fiscal slippages in Ghana and Kenya could complicate their relationships with the lender, according to Bank of America (NYSE:BAC).

Nigeria: “No IMF, No Problem”

Nigeria is experiencing improvements in macroeconomic stability, including a strengthening naira and steady domestic fuel prices, Bank of America notes. Rising oil production and potential tax reforms could provide further support, even as President Bola Tinubu’s administration pushes for higher spending.

Although Nigeria currently lacks an IMF program, the government may return to the Eurobond market in the second half of the year, BofA says.

Analysts expect real GDP growth to remain above 3%, supported by increased oil revenues, fiscal reforms, and improved liquidity in the foreign exchange market.

Ghana: Fiscal Risks Cloud Gold-Driven Growth

In Ghana, election-year spending in 2024 is contributing to fiscal slippages, even as the IMF program continues to serve as an anchor, BofA points out. The next IMF review is scheduled for April, followed by an Executive Board meeting in June.

“The scale of fiscal adjustment required in 2025 is concerning,” analysts warned, estimating a needed fiscal correction of 4% of GDP, largely through spending cuts. They see the fiscal deficit closer to 5% of GDP—above the government’s 4% target.

Still, Ghana’s macroeconomic backdrop remains relatively strong, supported by solid GDP growth driven by gold, a current account surplus, and rising foreign reserves. However, ongoing fiscal gaps could weigh on investor sentiment in the near term.

Kenya: Uncertainty Over New IMF Program

Kenya’s fiscal underperformance led the IMF to forgo the ninth and final review of its current program, BofA reports. The government is now seeking a new agreement, but the structure and timing remain unclear.