The International Monetary Fund has predicted that Nigeria’s economic growth will fall from 3.2 per cent in 2023 to 3.0 per cent in 2024.
This is as it retained Nigeria’s 3.2 per cent economic growth projection for 2023 in its recent world economic outlook update.
In its ‘World Economic Outlook: A Rocky Recovery (2023 Apr),’ report released on Tuesday, the IMF improved the country’s 2024 economic growth projection to 3.0 per cent from the 2.9 per cent it stated in its January update.
It stated in a table that Nigeria’s economy grew by 3.3 per cent in 2022. According to the Washington-based lender, global economic growth is expected to fall from 3.4 per cent in 2022 to 2,8 per cent in 2023.
It said, “The baseline forecast is for growth to fall from 3.4 per cent in 2022 to 2.8 per cent in 2023, before settling at 3.0 percent in 2024.
“Advanced economies are expected to see an especially pronounced growth slowdown, from 2.7 per cent in 2022 to 1.3 per cent in 2023. In a plausible alternative scenario with further financial sector stress, global growth declines to about 2.5 per cent in 2023 with advanced economy growth falling below 1 per cent.
“Global headline inflation in the baseline is set to fall from 8.7 per cent in 2022 to 7.0 per cent in 2023 on the back of lower commodity prices but underlying (core) inflation is likely to decline more slowly. Inflation’s return to target is unlikely before 2025 in most cases.”
According to the IMF, the economic prospect of emerging markets and developing economies, are on average stronger than those of advanced economies, although these prospects vary. It stated that on average, growth is expected to be 3.9 per cent in 2023 and to rise to 4.2 per cent in 2024.
The IMF noted that the other major forces that shaped the world economy in 2022 are likely to influence 2023 with debt levels remaining high and limiting the ability of fiscal policymakers to respond to new challenges. It added that the current uncertainty in the financial sector pose risk to the global economy.
It further explained that sovereign debt distress amid higher borrowing costs and lower growth could spread to other countries, and the war in Ukraine could intensify and lead to more food and energy price spikes, pushing inflation up.
Also on Tuesday, the World Bank Group President, David Malpass, predicted that global economic growth would slow to two per cent from 3.1 per cent in 2022.
He said this during his opening address at the ongoing Spring Meetings 2023 Media Call.
He stated, “Oil prices have jumped back above 80 dollars/barrel. The recent banking sector stress dampens activities and inflation pressures persist.”
He added, “The concern in our recent reports is that slow growth will persist for years for many developing countries, increasing the fiscal stress and debt problems. It is a combination of weak investment, higher interest rates, and relatively weak growth in advanced economies.”