The World Bank’s latest Global Economic Prospects report for January 2024 provides an encouraging outlook for Nigeria’s economy, forecasting a growth rate of 3.3 percent in the year 2024. This projection signifies an improvement from the 2.9 percent recorded in the previous year, showcasing a robust recovery from the challenges posed by the global health crisis.
Within the Sub-Saharan African (SSA) region, which encompasses Nigeria, there was a notable deceleration in economic growth, estimated at 2.9 percent in 2023. Nigeria, South Africa, and Angola, three major economies in the region, collectively experienced a reduced growth rate, averaging 1.8 percent in 2023. The challenges faced by Nigeria, including elevated input prices for businesses, contributed to this regional economic slowdown.
However, the World Bank points to the gradual fruition of macro-fiscal reforms initiated by the Nigerian government as a key driver behind the improved economic outlook. The report underscores Nigeria’s growth projection of 3.3 percent in 2024 and a further increase to 3.7 percent in 2025. These forecasts reflect positive momentum, indicating a turnaround in economic fortunes.
A noteworthy aspect of the report is the expectation that Nigeria’s per capita income will return to pre-pandemic levels by 2025. This highlights the resilience of the Nigerian economy and its ability to recover from the economic disruptions caused by the global pandemic.
The key sectors identified as drivers of this growth include agriculture, construction, services, and trade. These sectors are anticipated to play a pivotal role in the overall economic expansion of Nigeria in the coming years.
While the report emphasizes the positive trajectory of Nigeria’s economic prospects, it also sounds a cautionary note regarding geopolitical tensions. The rising geopolitical risks could pose near-term hazards for the global economy if adequate measures are not taken. This underscores the importance of vigilance and proactive measures to mitigate potential challenges on the horizon.
In the words of the World Bank Group’s Chief Economist and Senior Vice President, Indermit Gill, “Without a major course correction, the 2020s will go down as a decade of wasted opportunity.” The report calls for decisive actions by governments to accelerate investment and strengthen fiscal policy frameworks to avoid missed opportunities and foster transformative change.
In conclusion, the World Bank’s report instills confidence in Nigeria’s economic recovery, attributing positive growth to ongoing reforms and the resilience exhibited by key sectors. The emphasis on the need for proactive measures aligns with the broader global context, urging nations to seize opportunities and address challenges to ensure sustainable and inclusive economic growth.
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