ICYMI

June 12, 2024

World Bank affirms 3.3% economic growth forecast for Nigeria

economic growth forecast for Nigeria

World Bank

•Downgrades forecast for 2025 economic growth

By Peter Egwuatu

The World Bank yesterday affirmed its 3.3 per cent economic growth forecast for Nigeria in 2024 saying the nation’s economy was mildly buoyant in the early part of the year despite macroeconomic adjustments.

However, the World Bank downgraded its forecast for Nigeria’s economic growth in 2025 to 3.5 per cent, from the 3.7 per cent forecast made in January.

Similarly, the World Bank downgraded its forecast for Sub-Saharan economic growth in 2024 to 3.0 per cent from 3.8 per cent forecast made in January.

The report stated: “Growth in Sub-Saharan Africa (SSA) weakened to 3.0 per cent in 2023. Growth in the region’s largest three economies—Nigeria, South Africa, Angola—remained weak. In early 2024, private sector activity picked up, buoyed by a strengthening global economy.

At the same time, many economies in the region continue to struggle with weak government balance sheets, stemming partly from low revenue collection and high debt-service costs, while some also need to manage the adverse effects of currency depreciations. In Nigeria, growth slowed to 2.9 per cent in 2023. Despite ongoing macroeconomic adjustments, the economy was mildly buoyant in early 2024.

Growth in SSA is projected to pick up from 3.0 percent in 2023 to 3.5 percent in 2024 and about 4 percent annually in 2025-26, as fading inflationary pressures allow for interest rate cuts, which will support private consumption and investment.

Growth in the region’s largest three economies is expected to accelerate from 1.8 percent in 2023 to 2.4 percent in 2024 and an average of 2.6 percent in 2025-26. Yet, this is markedly below the region’s average growth. Non-resource-rich economies are forecast to maintain growth above their historical average rate, while resource-rich economies recover from their slow growth in 2023 that mainly reflected declining metal prices.