The International Monetary Fund (IMF) has released the July edition of its world economic outlook. The global lender has predicted a surge in the economy of countries in the sub-Saharan region of Africa with Nigeria leading the way.
The report identified the “improved prospects for Nigeria’s economy” as the major catalyst for the upgraded forecast for the whole region compared to what was obtainable in the April edition. Also, the likely increase in Nigeria’s Gross domestic product (GDP) to 2.3 percent reflected in the prediction.
“Its (Nigeria) growth is set to increase from 0.8 per cent in 2017 to 2.1 per cent in 2018 July 2018 and 2.3 per cent in 2019 on the back of an improved outlook for oil prices,” it read.
The organisation stated that the economic renaissance in sub-Saharan Africa will continue, owing to a rise in the price of commodities in the region.
“The recovery in Sub-Saharan Africa is set to continue, supported by the rise in commodity prices” it read. “For the region, growth is expected to increase from 2.8 per cent in 2017 to 3.4 per cent this year, rising further to 3.8 percent in 2019 (0.1 percentage point higher for 2019 than forecast in the April WEO).”
The report also reflects positive economic growth in parts of sub-Saharan Africa which might likely increase to 3.8 percent in 2019 compared to the 3.7 predictions made in April.
A silver lining
Contrary to comments made by the senior resident representative and Mission Chief for Nigeria, Amine Mati, during his visit to the country earlier this month, this projection gives the teeming population hope in the dwindling economy.
During his visit, Amine Mati said the country’s inflation would pick up in the second half of 2018 as base effects dissipate and higher spending and supply constraints in agriculture put pressure on prices. His comments, however, cannot be disconnected from the endless killings that have wreaked havoc in food producing states in the north. This has reduced the supply of local commodities and increased imports, thereby resulting in inflation.
Nigeria’s economy which is the largest in sub-Saharan Africa is still recovering from the big blow that hit it when the country plunged into recession in 2016. Figures from the National Bureau of Statistics revealed that the economy declined by 1.5 percent at the end of 2016 due to a drop in the global oil prices.
Despite constant efforts by the government to address the country’s perennial economic problem through the Economic Recovery and Growth Plan (ERGP), it appears that the country is still struggling with a low growth rate. However, with the latest projection, there is renewed hope that the country will bounce back despite its current economic woes.