Nigeria’s economy will grow from 3.0% in 2022 to 3.2% in 2023 due to measures taken to address insecurity in the oil sector, according to the International Monetary Fund.
The IMF revealed this in its World Economic Outlook Update (January 2023) report. He stated that growth in sub-Saharan Africa will moderate to 3.8 percent in 2023 amid the protracted fallout from the COVID-19 pandemic.
South Africa’s economy will fall from 2.6% in 2022 to 1.2% in 2023.
He said: “In sub-Saharan Africa, growth is projected to remain subdued at 3.8 percent in 2023 amid the protracted fallout from the COVID-19 pandemic, albeit with a modest upward revision from October, before rising to 4.1 percent in 2024.
“The small upward revision for 2023 (0.1 percentage points) reflects Nigeria’s increasing growth in 2023 due to measures to address insecurity issues in the oil sector. In South Africa, by contrast, after a re-opening rebound from COVID-19 in 2022, growth was projected to more than halve in 2023, to 1.2 percent, reflecting weaker external demand, shortages of energy and structural constraints”.
The Washington-based lender explained that global economic growth will slow in 2023 before picking up in 2024. This is because the global fight against inflation and Russia’s war in Ukraine weigh on activity.
Growth is forecast to slow from 3.4% in 2022 to 2.9% in 2023, and then recover to 3.1% in 2024.
According to the lender, its January forecast is much less bleak than its October forecast and could hint at a turning point, with growth bottoming out and inflation easing.
He said: “Economic growth proved surprisingly resilient in the third quarter of last year, with strong labor markets, robust domestic consumption and business investment, and a better-than-expected adaptation to the energy crisis in Europe.
“Inflation also showed improvement, with headline measures now declining in most countries, even if core inflation, which excludes more volatile energy and food prices, has yet to peak in many countries. .
Elsewhere, China’s sudden reopening paves the way for a quick rebound in activity. And global financial conditions have improved as inflationary pressures began to ease. This, and the weakening of the US dollar from its peak in November, provided modest relief to emerging and developing countries.
The United Nations recently projected that strong commodity trade and dynamic markets for consumer goods and services would propel Nigeria’s economic growth to three percent by 2023.
In its own prediction for 2023, the World Bank claimed that the Nigerian economy would grow by 2.9% in 2023.
In 2022, crude oil production in Nigeria plummeted due to the activities of pipeline vandals and oil thieves. Production fell to a low of 0.937 mbpd in September 2022, but recovered to 1.235 million barrels per day in December 2022.
