- IMF Sees Improve Growth in Nigeria in 2019
The International Monetary Fund on Tuesday lowered the world’s growth projection by 0.1 percent, saying trade tensions and increased tariffs between the US and China has impacted its previous projection.
In the same quarterly outlook, World Economic Outlook, the fund raised Nigeria’s growth projection by 0.3 percent to 2.3 percent for 2019.
In January, the fund had revised down Nigeria’s estimated growth from 2.3 percent to 2 percent in 2019 and from 2.5 percent to 2.2 percent in 2020, saying high debt servicing cost and weak business confidence will hurt Nigeria’s growth.
However, the fund has now revised its position in the new world economic outlook as Nigeria is expected to gain from rate cuts in developed economies and stimulate growth within with the new Central Bank of Nigeria’s policy aimed at compelling Deposit Money Banks to increase lending to the private sector.
Still, the expected growth rate is below Nigeria’s population growth rate of 2.6 percent, meaning until the nation’s economic growth rate is higher than the population growth rate, Nigeria is merely sustaining economic recovery.
Global growth is projected to expand at 3.2 percent in 2019 and 3.5 percent in 2020, 0.1 percent lower than the previous projections.
“We are revising downward our projection for global growth to 3.2 per cent in 2019 and 3.5 per cent in 2020. While this is a modest revision of 0.1 percentage points for both years relative to our projections in April, it comes on top of previous significant downward revisions,” the IMF stated.
“The revision for 2019 reflects negative surprises for growth in emerging market and developing economies that offset positive surprises in some advanced economies.”
Meanwhile, the Central Bank of Nigeria led Monetary Policy Committee left interest rates unchanged on Tuesday in spite of recent moderation in consumer prices.
The committee said given new CBN policy at stimulating growth, current rates level is necessary to curb a possible increase in prices due to the projected surge in money supply.