Nigeria’s Economy To Contract By 4.3% – IMF
The International Monetary Fund (IMF) on Tuesday said that Nigeria’s economy will experience a contraction of 4.3 per cent in 2020.
The new outlook for Nigeria’s second half of 2020 is contained in the World Economic Outlook released on Tuesday by the Bretton-wood institution.
The new projection, according to the IMF report, lowers by 1.1 percent the earlier 5.4 percent contraction projected in June.
It attributed the new outlook for the country to the recovery of global oil prices; Nigeria’s ease of lockdown, and reopening of many sectors of the economy.
The IMF Chief Economist, Gita Gopinath, remarked that the current projection is less severe though the country is still deep in recession in 2020.
Gopinath said, “We are projecting a somewhat less severe though still deep recession in 2020, relative to our June forecast.”
The World Monetary body said Nigeria’s 2021 Gross Domestic Product will grow by 1.7 per cent, a downgrade of its earlier projection in June 2020 , that the economy will rebound by 2.6 per cent in 2021.
In its global projection, the IMF report said global growth in 2021 will surge to 5.2 percent.
It added that global growth will fall by 4.4 percent in 2020.
This presents a less severe contraction than its 4.9 contraction forecast as contained in the June 2020 World Economic Outlook.
The report said, “The revision reflects better-than-anticipated second-quarter GDP outturns, mostly in advanced economies, where activity began to improve sooner than expected after lockdowns were scaled back in May and June, as well as indicators of a stronger recovery in the third quarter.”
“Following the contraction in 2020 and recovery in 2021, the level of global GDP in 2021 is expected to be a modest 0.6 percent above that of 2019. This implies that both advanced and emerging market and developing economies will only modestly progress toward the 2020–25 path of economic activity projected before the COVID-19 pandemic.”
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