Nigeria’s New Government will Deal with Subpar Economic Growth- World Bank

Nigeria’s new government will deal with subpar economic growth- World Bank

The World Bank has predicted that this year will see sluggish economic growth and significant policy issues for Nigeria’s incoming government.

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NewsReport indicate that the bank forecast 2.8 percent economic growth for Nigeria in 2023 in its most recent Africa’s Pulse report for April 2023, which was released on Wednesday.

The World Economic Prospects report from the bank, which was released in January of this year, had previously predicted a growth rate of 2.9 percent, but this current estimate is lower.

Part of the report read, “The growth recovery in Nigeria for 2023 (2.8 percent) is still fragile as oil production remains subdued and the new administration faces many policy challenges.”

In Africa’s Pulse report, the global bank noted that Nigeria’s economy would underperform due to a weaker local currency, foreign exchange scarcity, and rising inflation.

“Non-oil economic activity remained weak as the agriculture and industrial sectors experienced a rapid increase in the costs of energy and raw materials that were magnified by a weaker naira in the foreign exchange market.”

The World Bank also commented on the CBN’s cashless policy, which weighed on economic activities.

The report noted that “the demonetization efforts that started in mid-December are weighing on economic activity. The Stanbic IBTC Bank PMI contracted to 44.7 in February 2023, from 53.5 in January 2022, as business output and new orders were sharply affected by cash shortages.”