Nigeria’s economic growth increases by 3.2% – IMF

Following the measures made to address insecurity in the oil sector, the International Monetary Fund has said that Nigeria’s economy is set to grow from 3.0 per cent in 2022 to 3.2 per cent in 2023.

The IMF, while disclosing this in its World Economic Outlook Update (January 2023) report, stated that growth across sub-Saharan Africa will moderate at 3.8 per cent in 2023 amid prolonged fallout from the COVID-19 pandemic.

It added that South Africa’s economy will fall from 2.6 per cent in 2022 to 1.2 per cent in 2023.

It said, “In sub-Saharan Africa, growth is projected to remain moderate at 3.8 per cent in 2023 amid prolonged fallout from the COVID-19 pandemic, although with a modest upward revision since October, before picking up to 4.1 percent in 2024.

“The small upward revision for 2023 (0.1 percentage point) reflects Nigeria’s rising growth in 2023 due to measures to address insecurity issues in the oil sector. In South Africa, by contrast, after a COVID-19 reopening rebound in 2022, projected growth more than halves in 2023, to 1.2 percent, reflecting weaker external demand, power shortages, and structural constraints.”

The Washington-based lender explained that growth in the global economy will slow down in 2023 before bouncing back in 2024. This is as the global fight against inflation and Russia’s war in Ukraine weigh on activity.

Growth is forecasted to slow from 3.4 per cent in 2022 to 2.9 per cent in 2023, then rebound to 3.1 per cent in 2024.

It said, “Economic growth proved surprisingly resilient in the third quarter of last year, with strong labour markets, robust household consumption and business investment, and better-than-expected adaptation to the energy crisis in Europe.

“Inflation, too, showed improvement, with overall measures now decreasing in most countries—even if core inflation, which excludes more volatile energy and food prices, has yet to peak in many countries.

“Elsewhere, China’s sudden re-opening paves the way for a rapid rebound in activity. And global financial conditions have improved as inflation pressures started to abate. This, and a weakening of the US dollar from its November high, provided some modest relief to emerging and developing countries.”

However, in its own prediction for 2023, the World Bank stated that the Nigerian economy would grow at 2.9 per cent in 2023, saying in 2022, crude oil production in Nigeria nosedived because of the activities of pipeline vandals and oil thieves. Production crashed to a low of 0.937mbpd in September 2022 but rebounded to 1.235 million barrels per day in December 2022.