IMF Raises Nigeria’s Economic Growth Forecast From 2.7% To 3.4%

The International Monetary Fund has raised Nigeria’s economic growth projection in the 2022 fiscal period to 3.4 per cent.

The IMF disclosed this in its ‘World Economic Outlook: War Sets Back the Global Recovery, April 2022,’ report.

The rise in growth forecast was as a result of the increase in global oil prices induced by the war between Russia and Ukraine.

The IMF had in January predicted a growth rate of 2.7 per cent for Nigeria in 2022. But it has adjusted its projection based on increasing oil prices.

In its latest forecast, the institution revealed a 3.1 per cent growth projection for the nation in 2023, down from 3.4 per cent in 2022 and 3.6 per cent in 2021.

It said, “In sub-Saharan Africa, food prices are also the most important channel of transmission, although in slightly different ways.

“Wheat is a less important part of the diet, but food, in general, is a larger share of consumption. Higher food prices will hurt consumers’ purchasing power—particularly among low-income households—and weigh on domestic demand. Social and political turmoil, most notably in West Africa, also weighs on the outlook.

“The increase in oil prices has however lifted growth prospects for the region’s oil exporters, such as Nigeria. Overall, growth in sub-Saharan Africa is projected at 3.8 per cent in 2022.”

For the global economy, it said this is expected to grow by 3.6 per cent in 2022 and 2023 as a result of the war on Ukraine, and sanctions on Russia.

It said, “Global growth is projected to slow from an estimated 6.1 per cent in 2021 to 3.6 per cent in 2022 and 2023.

“This is 0.8 and 0.2 percentage points lower for 2022 and 2023 than in the January World Economic Outlook Update. Beyond 2023, global growth is forecast to decline to about 3.3 per cent over the medium term.”