IMF Says Growth in Nigeria to Contract by 4.3 Percent in 2020

Following the World Bank’s projection that the Nigerian economy would contract by 4.1 percent in 2020, the International Monetary Fund has also said Nigeria, Africa’s largest economy, would contract by 4.3 percent in 2020.

The Fund disclosed this in its latest World Economic Outlook report for the month of October.

The new projection is higher than the 3.4 percent contraction initially predicted by the Fund in April and 5.4 percent decline projected in the month of June.

However, while the World Bank projected that Nigeria’s economy would rebound slightly by 0.3 percent in 2021, the International Monetary Fund said the nation’s growth would recover by 1.7 percent next year.

The Fund also predicted that global growth would shrink by 4.4 percent in the current year due to the severe impacts of COVID-19 on the world’s commerce.

It, therefore, said global growth would recover and expand by 5.2 percent next year, slightly below the June projection.

It stated, “Global growth is projected at 5.2 per cent in 2021, a little lower than in the June 2020 WEO Update, reflecting the more moderate downturn projected for 2020 and consistent with expectations of persistent social distancing.

“Following the contraction in 2020 and recovery in 2021, the level of global GDP in 2021 is expected to be a modest 0.6 per cent above that of 2019.

“The growth projections imply wide negative output gaps and elevated unemployment rates this year and in 2021 across both advanced and emerging market economies.

“After the rebound in 2021, global growth is expected to gradually slow to about 3.5 per cent into the medium term.”