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IMF, World Bank Differ On Nigeria’s Growth Forecast
Contrary to the 2.1 per cent growth projected by the World Bank in the Nigerian economy, the International Monetary Fund (IMF) has projected 2.5 per cent growth for it.
The IMF projection, as contained in its January Global Economic Outlook, released yesterday, covers two-year growth target.
The IMF prediction is 0.4 per cent higher than 2.1 per cent projected by the World Bank for three years: 2020 – 2023.
The World Bank report was captured in its January Global Economic Prospects released on January 8.
It, however, described the country’s macroeconomic framework as not “conducive to confidence”, adding that the macroeconomic framework is characterised by multiple exchange rates, foreign exchange restrictions and persistent inflation.
In the report titled: “Tentative stabilisation, sluggish recovery”, signed by Gita Gopinath, an Economic Counsellor and Director of the Research Department at the Fund, the IMF said the Nigerian economy will grow at 2.5 per cent this year and the next.
According to the Fund, the economy grew 1.9 per cent in 2018 and 2.3 per cent last year.
The IMF report said in sub-Saharan Africa, growth is expected to strengthen to 3.5 percent in 2020 to 2021 from 3.3 per cent last year.
The projection is 0.1 percentage point lower than in the October World Economic Outlook for 2020 and 0.2 percentage point weaker for 2021.
“This”, the Fund said: “reflects downward revisions for South Africa (where structural constraints and deteriorating public finances are holding back business confidence and private investment) and for Ethiopia where public sector consolidation, needed to contain debt vulnerabilities, is expected to weigh on growth.”
It said global growth is projected to rise from an estimated 2.9 per cent last year to 3.3 per cent in 2020 and 3.4 per cent for 2021 a downward revision of 0.1 percentage point for last year and 2020 and 0.2 for 2021.
According to the IMF, low interest rates and reduced trade tensions will likely buoy the global economy over the next two years and help nurture steady if modest growth.
The IMF said emerging market economies in macroeconomic distress related to domestic imbalances would need to continue making the policy adjustments necessary for rebuilding confidence and putting in place the conditions for a return to stable and sustainable growth.
The report said: “In these contexts, ensuring adequate safety nets to protect the vulnerable remains critical within overall existing constraints.
“Payment of tuition fees for undergraduate/postgraduate studies shall be subject to a maximum limit of $25,000.00 per semester,” the Manual states.
The expansion of international card limits also reflects growing confidence among lenders that foreign exchange liquidity has improved enough to support retail dollar transactions.
Speaking recently at the BusinessDay 14th Annual CEO Forum in Lagos, CBN Olayemi Cardoso, governor of the CBN said buying and selling activities now increasingly determine outcomes in the foreign exchange market, unlike in the past when market participants relied heavily on routine Central Bank interventions.
According to Cardoso, Nigeria’s net foreign exchange reserves have risen from just over $3 billion at the start of the reform programme to more than $40 billion, while gross reserves have climbed to about $52 billion, providing stronger confidence for investors and enabling the Central Bank to reserve interventions for periods of market stress rather than day-to-day liquidity management.
The restoration and expansion of international naira card spending limits are increasingly being seen as one of the clearest signs that the benefits of the CBN’s foreign exchange reforms are beginning to reach households, students and businesses making legitimate cross-border payments.
The Secretary-General and Chief Executive Officer, WEC, Dr Angela Wilkinson, disclosed this in a statement, last Thursday.
“Nigeria’s participation comes at a pivotal time as the country seeks to expand energy access, strengthen energy security, accelerate gas development and mobilise the capital required for industrialisation and sustainable economic growth.
“WEC Nigeria will convene leaders from across the energy ecosystem, apply the WEC’s globally recognised Energy Trilemma framework to Nigeria’s unique context, and promote evidence-based dialogue, practical collaboration and informed policymaking.
“It will also ensure that Nigerian and broader African perspectives contribute meaningfully to global energy conversations,” she said.
Wilkinson expressed confidence that Nigeria would play a significant leadership role at the World Energy Congress scheduled for Riyadh in April 2027 and beyond.
The statement also quoted the Chairman of WEC Nigeria, Isa, as describing the country’s participation as an opportunity to deepen national and African leadership within the global energy community through practical solutions tailored to regional development priorities.
He said the platform would promote collaboration across sectors and attract sustainable investments into Nigeria’s energy sector.
The Chief Executive Officer of WEC Nigeria, Wunti, was quoted in the statement as saying that the council would connect leadership, evidence and investment to build a secure, affordable and sustainable energy system.
“This system will be capable of driving economic growth and shared prosperity.”
According to him, the platform will also connect Nigerian institutions and businesses with international knowledge, technology, partnerships and investment opportunities through the World Energy Council’s global network.
Recall that WEC, founded in 1923, is the world’s oldest independent and impartial community of energy leaders and practitioners, advancing informed, collaborative and practical action across the global energy system.