By Ayo Yusuf
Two months after predicting that Nigeria’s economy would grow by 3.2 per cent in 2023, the International Monetary Fund, IMF, has downgraded the nation’s growth figure to 2.9 per cent.
The IMF said the reduction of the growth rate for Africa’s largest economy by 0.3 percentage was the result of lower production in oil and gas.
The IMF made these predictions in its new World Economic Outlook (for October) themed, ‘Navigating Global Divergences,’ released on Tuesday.
Earlier in July, the lending institution predicted that Nigeria’s economy would grow by 3.2 per cent in 2023, adding that the growth would be impacted by security issues in the oil sector.
Commenting on its new prediction for the country, the IMF said, “Growth in Nigeria is projected to decline from 3.3 per cent in 2022 to 2.9 per cent in 2023 and 3.1 per cent in 2024, with negative effects of high inflation on consumption taking hold.
“The forecast for 2023 is revised downward by 0.3 percentage point, reflecting weaker oil and gas production than expected, partially as a result of maintenance work,” IMF stated.
However, according to the National Bureau of Statistics, Nigeria’s GDP grew by 2.51 per cent in the second quarter of 2023.
Growth in the sub-Saharan African region is expected to decline to 3.3 per cent in 2023 due to worsening weather shocks, the global slowdown, and domestic supply issues, the IMF noted.
It, however, stated that this growth will begin to rise by 2024 to 4.0 percent which is still below the region’s historical average of 4.8 per cent.
Overall, global economic growth is projected to slow from 3.5 per cent in 2022 to 3.0 per cent in 2023 and 2.9 per cent in 2024, well below the historical (2000–19) average of 3.8 per cent, the IMF declared.
It added, “Advanced economies are expected to slow from 2.6 per cent in 2022 to 1.5 per cent in 2023 and 1.4 per cent in 2024 as policy tightening starts to bite. Emerging market and developing economies are projected to have a modest decline in growth from 4.1 per cent in 2022 to 4.0 per cent in both 2023 and 2024.”
Inflation, which has been on a global rise, is expected to fall from 8.7 per cent in 2022 to 6.9 per cent in 2023 and 5.8 per cent in 2024, the IMF noted.
Earlier this year, the IMF had warned African leaders to be careful because economic policies, not loans will be needed to tackle inflation.
