IMF raises Nigeria’s 2019 GDP growth forecast to 2.3%
As against its earlier forecast of 1.9 per cent, the International Monetary Fund IMF has projected 2.3 per cent Gross Domestic Product GDP growth for Nigeria in 2019.
The fund had in April this year projected that Nigeria’s GDP would grow by 1.9 per cent in 2019.
However in its World Economic Outlook update released yesterday, the fund said that the upgraded forecast, “reflects improved prospects for Nigeria’s economy” and an increase in commodity prices.
The fund also retained the 2.1 per cent growth projection for the country this year from 0.8 per cent in 2017. Revising 2019 GDP growth forecast for the continent’s biggest economy upwards, the Fund also forecast that Sub-Saharan African’s economy will expand by 3.8 per cent next year.
This compares with a 3.7 per cent prediction in April. Nigeria’s economy, which is recovering from the worst contraction in 25 years in 2016, is apparently showing better prospects than the continent’s second biggest economy, South Africa’s, according to the IMF. Consequently, the Fund held its predictions for South Africa’s economy, saying it will expand 1.5 per cent this year and 1.7 per cent the next.
“Despite the weaker than- expected first-quarter out-turn in South Africa, the economy is expected to recover somewhat over the remainder of 2018 and into 2019, as confidence improvements associated with the new leadership are gradually reflected in strengthening private investment,” the fund said.
South Africa, the continent’s most-industrialized economy, hasn’t grown at more than 2 per cent a year since 2013. GDP shrank the most in almost a decade in the first quarter, as former President Jacob Zuma handed the reins to Cyril Ramaphosa. Nigeria and South Africa’s economies account for about half of the region’s GDP.
On the global economy, the IMF stated that due to rising tensions over international trade, the broad global expansion that began roughly two years ago has plateaued and become less balanced. It stated that while it continues to project global growth rates of just about 3.9 per cent for both this year and next, it believes that the risk of worse outcomes has increased, even for the near term.
The fund also said: “Growth remains generally strong in advanced economies, but it has slowed in many of them, including countries in the euro area, Japan, and the United Kingdom. In contrast, GDP continues to grow faster than potential and job creation is still robust in the United States, driven in large part by recent tax cuts and increased government spending.