Nigeria’s economy now projected to grow by 3.3% in 2024 – IMF
The economic growth forecast for Nigeria in the April 2024 IMF World Economic Outlook (WEO) has been adjusted upwards to 3.3%, showing a 0.3% increase from the 3.0% forecasted in the January 2024 WEO update.
Factors contributing to this upward revision include the expected growth of the oil sector by 6.9% year-on-year in 2024, a significant improvement from the 2.22% decline seen in 2023; the appreciation of the Naira against the dollar; and the rise in oil production to 1.43mpbd in February 2024.
The IMF World Economic Outlook maintains its forecast for Sub-Saharan Africa, predicting a Real GDP growth of 3.80% year-on-year in the region, surpassing the 3.40% recorded in 2023 and the projected 4.0% for 2025.
Furthermore, the outlook foresees a global slowdown in the inflation rate, with an average annual decrease from 6.8% in 2023 to 5.9% in 2024 and 4.5% in 2025. Nigeria’s inflation is projected to rise to 26.3% in 2024 from 24.7% in 2023 before dropping to 23.0% in 2025.
The anticipated inflation rate for 2024 is lower than the March figure of 32.7%, indicating the Fund’s expectation of a deceleration in Nigeria’s inflation rate in the remaining quarters of the year.
While the increase in oil production will lead to higher revenue and foreign exchange earnings, the government must diversify the export earnings sources for sustainable long-term growth and to mitigate oil price fluctuations. This diversification strategy may involve bolstering non-oil sectors like manufacturing, mining, and other emerging industries.
