Nigeria’s Economic Outlook

7 mai 2018Wathinote Diversification économie

Author (s): African Development Bank Group (AfDB)

The African Development Bank Group is a development and finance institution which focuses on sustainable economic development, social progress, and poverty reduction.

Original document here

Economic performance and outlook

The economy continued to show signs of recovery from the 2016 recession. GDP growth was estimated at 0.8% in 2017, up from –1.5% in 2016. The outlook beyond is positive, with growth projected at 2.1% in 2018 and 2.5% in 2019. This outlook is anchored in higher oil prices and production, as well as stronger agricultural performance. Oil prices rebounded to an average of $52 per barrel (Brent crude) in 2017 and are projected to reach $54 in 2018, up from $43 per barrel in 2016. Oil production also increased from 1.45 million barrels per day in the first quarter of 2017 to 2.03 million in the third quarter of 2017 following deescalation of hostilities in the delta region and is expected to remain at the same level in 2018 and 2019, in tandem with the Organization of the Petroleum Exporting Countries production restrictions.

Macroeconomic evolution

Fiscal policy remained expansionary in 2017 as in 2016. Although total spending as a percentage of GDP declined from 13% in 2014 to 10.3% in 2017, revenues declined more sharply, from 11.4% to 5.6%. The budget deficit was estimated at 4.8% in 2017, up from 4.7% in 2016, and is projected to improve to 4.3% in 2018 and 4.1% in 2019, as revenue performance improves. At 14%, unemployment remained high in 2017, the same as in 2016, and is expected to decline only slightly in 2018, to 13.5%, as recovery eases production constraints in manufacturing and agriculture. Monetary policy continued to be contractionary in 2017 and is expected to remain so in 2018; the policy rate has been kept at 14% since July 2016 to support the naira and control inflation. Inflation has remained stubbornly high and in the double digits—an estimated 16.2% in 2017, up from 15.6% in 2016—but is projected to ease to 13.7%

in 2018 and 12% in 2019. Foreign currency liquidity has improved following the introduction of administrative measures by the Central Bank since early 2017. The measures include a trading window for portfolio investors at market determined rates and the introduction of the Nigerian Autonomous Foreign Exchange Rate Fixing, which allowed commercial banks to quote forex rates that are close to parallel market rates. The naira remained stable for most of 2017 and is expected to strengthen slightly as the economy continues to recover.

Tailwinds

The recovery in oil prices and production will help drive growth and provide fiscal space as the government pursues important structural reforms to diversify the economy. Faithful implementation of the Economic Recovery and Growth Plan (2017–20) holds the promise of weaning the country off its dependence on oil. The plan focuses on six priority sectors: agriculture; manufacturing; solid minerals, including iron, gold, and coal; services, including information and communication technology, financial services, tourism, and creative industries; construction and real estate; and oil and gas. The government has produced specific programs for each sector and defined broader growth policy enablers to drive the plan.

Headwinds

Nigeria still faces significant challenges, including foreign exchange shortages, disruptions in fuel supply, power shortages, and insecurity in some parts of the country. Revenue mobilization efforts are insufficient; at 5%, value added tax rates are among the lowest in the world, and revenue administration is inefficient. Poverty is unacceptably high; nearly 80% of Nigeria’s 190 million people live on less than $2 a day.

Les Wathinotes sont soit des résumés de publications sélectionnées par WATHI, conformes aux résumés originaux, soit des versions modifiées des résumés originaux, soit des extraits choisis par WATHI compte tenu de leur pertinence par rapport au thème du Débat. Lorsque les publications et leurs résumés ne sont disponibles qu’en français ou en anglais, WATHI se charge de la traduction des extraits choisis dans l’autre langue. Toutes les Wathinotes renvoient aux publications originales et intégrales qui ne sont pas hébergées par le site de WATHI, et sont destinées à promouvoir la lecture de ces documents, fruit du travail de recherche d’universitaires et d’experts.

The Wathinotes are either original abstracts of publications selected by WATHI, modified original summaries or publication quotes selected for their relevance for the theme of the Debate. When publications and abstracts are only available either in French or in English, the translation is done by WATHI. All the Wathinotes link to the original and integral publications that are not hosted on the WATHI website. WATHI participates to the promotion of these documents that have been written by university professors and experts.

272 Commentaires. En écrire un nouveau

Albertbof

29 juin 2025 18 h 01 min

silkroad online pharmacy reviews: best ed medication – Pharma Connect USA

Article

Nigeria’s Economic Outlook

272 Commentaires. En écrire un nouveau

Laisser un commentaire Annuler la réponse