The International Monetary Fund (IMF) has projected an economic growth of 2.1 per cent for the Nigerian economy in 2019. This is contained in a report on the IMF’s Executive Board’s 2019 Article IV Consultation with Nigeria, released on April 3, 2019.
According to the IMF, Nigeria’s economy is recovering. Real GDP increased by 1.9 percent in 2018, up from 0.8 percent in 2017, on the back of improvements in manufacturing and services. It is expected to increase by 2.1 per cent in 2019.
“Headline inflation fell to 11.4 percent at end-2018, reflecting declining food price inflation, weak consumer demand, a relatively stable exchange rate and tight monetary policy during most of 2018, but remains outside of the central bank’s target range of 69 percent. Record holdings of mostly short-term local debt and equity and a current account surplus lifted gross international reserves to a peak in April 2018, while the three-times oversubscribed November 2018 Eurobond helped cushion the impact of outflows later in the year”
However, the international financial institution noted that persisting structural and policy challenges continue to constrain growth to levels below those needed to reduce vulnerabilities, lessen poverty and improve weak human development outcomes, such as in health and education.
“A large infrastructure gap, low revenue mobilization, governance and institutional weaknesses, continued foreign exchange restrictions, and banking sector vulnerabilities are dampening long-term foreign and domestic investment and keeping the economy reliant on volatile oil prices and production. Under current policies, the outlook remains therefore muted.”
Recall that in January, the IMF had cut Nigeria’s 2019 growth forecast to 2%