Lowers Nigeria’s 2021 growth forest to 1.7%
The International Monetary Fund (IMF) this morning said it expects Nigeria’s economy to grow slower in 2021 than it earlier projected in June.
Consequently, the IMF lowered its forecast for Nigeria’s economic growth in 2021 to 1.7%, down from 2.6% it earlier projected in June.
However, the IMF upgraded its forecast for Nigeria’s economic growth in 2020, saying the country’s economy will now contract by 4.3 percent, an improvement from the 5.4 percent contraction forecast in June.
The Fund stated this in its October 2020 World Economic Outlook (WEO) released this morning.
The IMF had earlier projected that Nigeria’s economy will contract by 5.4% in 2020 but grow by 2.6% in 2021. The IMF, in the updated version of its June WEO, said: “In Nigeria, the economic contraction is projected to deepen to 5.4 percent in 2020 (down by 2.0 percentage points from the April 2020 Regional Economic Outlook: SubSaharan Africa) as the country was hit hard by plummeting oil prices, lower oil production quota and declining activity. Growth is projected to recover to 2.6 percent in 2021 with rising oil prices and increasing production”
The IMF is expected to provide explanations for the improved forecast for Nigeria’s economic growth in 2020, next week when it releases its Regional Economic Outlook for Africa.
The improved forecast was however not extended to the country’s economy in 2021, as the IMF lowered its economic growth forecast for Nigeria for 2021 to 1.7% from 2.1 percent stated in its June WEO.
Data from the Nigeria’s National Bureau of Statistics (NBS) showed that the country’s economy contracted by Gross Domestic Product (GDP) by 6.1 percent in the second quarter of the year (Q2’2020) down from 1.8 percent growth in Q1’2020. The contraction in Q2’ 2020 was caused by the restrictions introduced across the country to curb the spread of the coronavirus.