Nigeria’s economic recovery gain strength on agriculture, services: IMF

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LAGOS, June 16 — Nigeria’s economic recovery continues to gain strength on the back of services and agriculture, with gross domestic product(GDP) growth projected at 3.4 percent year on year in 2022, the International Monetary Fund(IMF) said.

In a statement reaching Naija247News on Thursday, the IMF said the latest data shows economic growth in Nigeria broadens in all sectors except oil, where production remains weak due to continued security and technical challenges.

According to reports by local media, Nigeria’s oil output dropped year on year by 23.8 per cent to 1.024 million barrels per day in May 2022, from 1.344 million barrels per day recorded in the corresponding period of 2021.

“On the upside, steady private sector recovery and further broadening of growth,…and decisive steps to mobilize revenues, in line with the Strategic Revenue Growth Initiative (SRGI) could spur inclusive growth and development,” said the statement.

However, the IMF warns of risks including escalating inflation and high fiscal deficit in Africa’s biggest economy.

“Inflation has reached 17.7 percent year on year in May, led by a renewed surge in food prices, exacerbated by the war in Ukraine and raising food security concerns as over 40 percent of the population live below the poverty line,” the statement said.

“The fiscal deficit of the consolidated government is expected to remain high at 6.1 percent of GDP due in great measure to costly petrol subsidies and limited tax revenue collections,” it added.

Downside risks to the near-term arise from further deterioration of security conditions, elections, low vaccination against COVID-19 and higher global interest rates, the IMF said. ■