Business
Why we reversed Nigeria’s growth projection — IMF
The International Monetary Fund (IMF) on Tuesday revised Nigeria’s economic growth projection downward to 2.9 per cent in 2024, on the basis of insecurity in oil-producing areas, the impact of floods and lower-than-expected activity in the first half of the year.
The IMF’s Chief Economist, Pierre-Olivier Gourninchas, disclosed this during the World Economic Outlook press briefing at the ongoing IMF/World Bank Annual Meetings in Washington, D.C.
“We reversed Nigeria’s growth by 2 percent down because things are volatile. The reason for the reversal is precisely because of issues in agriculture due to flooding, and issues about the production of oil relative to security, which pushed down oil production,” Gourninchas explained.
As a result of these challenges, the IMF has revised Nigeria’s economic growth projection for 2024 to 2.9 percent, down from the 3.1 percent forecast in July. Earlier, in April, the IMF had projected a growth rate of 3.3 percent for the country, which was then lowered to 3.1 percent in July.
When asked about the impact of the Nigerian government’s decision to remove fuel subsidies—a policy that has reportedly worsened the economic hardships faced by ordinary Nigerians—Gourninchas declined to provide immediate insights. “I am afraid, I have to go back and check as I don’t have the numbers ready on the impact of the removal of the fuel subsidy specifically,” he said in response to a Nigerian journalist’s inquiry.
In its latest World Economic Outlook report, the IMF indicated that global growth is expected to remain stable but underwhelming. While the forecast for the United States has been upgraded, these gains are offset by downgrades in other advanced economies, particularly in Europe.
Emerging markets and developing economies, including sub-Saharan Africa, have also seen downward revisions due to disruptions in the production and shipping of commodities—especially oil—conflicts, civil unrest, and extreme weather events.
However, the IMF noted that upgrades in emerging Asia, driven by strong demand for semiconductors and investments in artificial intelligence in China and India, have partially compensated for the declines in other regions.
Looking ahead, the IMF projected global growth to reach 3.1 percent over the next five years, which it described as a “mediocre performance.” The Fund emphasized the importance of structural reforms and targeted support for vulnerable populations to enhance global economic resilience.
The IMF also stressed that as disinflation continues globally, the dynamics within individual sectors, particularly in services, must be carefully managed to ensure a smooth economic landing while maintaining price stability.