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IMF retains 2.5% growth projection for Nigeria

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The International Monetary Fund (IMF) has retained Nigeria’s 2.5 percent forecast for Nigeria’s economic growth this year.

The institution disclosed this in its World Economic Outlook (WEO) for July titled: “Fault Lines Widen in the Global Recovery” released on Tuesday in Washington DC.
According to IMF, the slow rollout of vaccines was the main factor weighing on the recovery for Low-Income Developing Countries (LIDCs) including Nigeria.

It also retained its 6.0 percent growth forecast for the global economy for 2021 and 4.9 percent in 2022, adding that though the global forecast was unchanged from the April prediction, there were offsetting revisions.

The IMF had at its 2021 Virtual Spring Meetings in April, projected a 2.5 percent growth for Nigeria’s economy in 2021, up from 1.5 percent projected in January.

READ ALSO: IMF to provide African members special drawing rights of $650bn

IMF said in LIDCs, the overall fiscal deficit in 2021 was revised up by 0.3 percentage points from the April forecast mainly because of the re-emergence of fuel subsidies as well as the additional COVID-19 and security related support in Nigeria.

The institution said: “Still, at 5.2 percent of Gross Domestic Product (GDP), the overall fiscal deficit remains well below that of advanced and emerging market economies, reflecting financing constraints, about 60 percent of LIDCs are assessed to be at high risk of or in debt distress.

“The public debt-to-GDP ratio for 2021 is projected at 48.5 percent.

“Several LIDCs have announced an intention to restructure their debts and some have sought debt relief under the G20 Common Framework (Chad, Ethiopia, and Zambia).”

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