The International Monetary Fund (IMF) has increased Nigeria’s 2022 GDP growth prediction from 2.7 percent to 3.4 percent.
The fund raised its growth prediction for the Nigerian economy in 2022 by 0.3% to 2.6% from its previous projection in its April 2021 edition, while maintaining its growth forecast for 2021.
This was stated by the IMF in its 2018 World Economic Outlook (WEO), which was issued on Tuesday during the ongoing hybrid spring meetings in Washington, DC, in partnership with the World Bank.
According to the survey, Nigeria’s positive assessment was attributable to a rise in oil prices.
“The surge in oil prices has, however, raised economic expectations for the region’s oil exporters, such as Nigeria,” the fund added. Sub-Saharan Africa’s growth rate is expected to be 3.8% in 2022.
“Food costs are likewise the most significant channel of transmission in Sub-Saharan Africa, but in slightly different ways.” Wheat is a less essential element of the diet, but food in general consumes a bigger portion of the population.
“Higher food costs will reduce consumers’ purchasing power, especially among low-income households, and will weigh on domestic demand.” The prognosis is further hampered by social and political unrest, particularly in West Africa.”
Nigeria’s economy will face a recession in 2020, reversing three years of progress, as crude oil prices decline owing to declining global demand and containment efforts to combat the spread of COVID–19.
Containment measures mostly impacted the aviation, tourism, hospitality, restaurants, manufacturing, and trade industries. These contractions were compensated by demand-driven increase in the financial and information and communications technology sectors.
The IMF estimates that real GDP will have decreased by 3% in 2020, despite mitigating measures under the Economic Sustainability Programme (ESP) preventing the loss from being considerably worse.