The International Monetary Fund has revised Nigeria’s economic growth projection for 2023 downwards by 0.3 percentage points to 2.9%, citing weaker oil and gas production.
This was contained in a report by the IMF’s World Economic Outlook titled ‘Navigating Global Divergences’ in October.
In July, the IMF had initially forecasted Nigeria’s 2023 economic growth at 3.2%, taking into account potential disruptions in the oil sector due to security concerns.
Explaining the revised prediction, the IMF mentioned that Nigeria’s growth is expected to decline from 3.3% in 2022 to 2.9% in 2023 and 3.1% in 2024.
This decline is attributed to the adverse effects of high inflation on consumption and lower-than-expected oil and gas production, partly due to maintenance work.
During the second quarter of 2023, Nigeria’s GDP experienced a growth rate of 2.51%, as reported by the National Bureau of Statistics.
The IMF also indicated that economic growth in the sub-Saharan African region is anticipated to decrease to 3.3% in 2023 due to factors such as adverse weather conditions, a global economic slowdown, and domestic supply challenges.
However, it expects a modest recovery to 4.0% in 2024, although still below the region’s historical average of 4.8%.
On a global scale, the IMF forecasts a slowdown in economic growth, declining from 3.5% in 2022 to 3.0% in 2023 and further to 2.9% in 2024.
This projection falls significantly below the historical average of 3.8% for the years 2000-2019.
The IMF predicts that advanced economies will experience a reduction in growth, dropping from 2.6% in 2022 to 1.5% in 2023 and 1.4% in 2024, primarily due to tightening policies.
Emerging markets and developing economies are also expected to see a modest decrease in growth from 4.1% in 2022 to 4.0% in both 2023 and 2024.
Regarding inflation, the IMF anticipates a decline from 8.7% in 2022 to 6.9% in 2023 and 5.8% in 2024 on a global scale.
