IMF- Nigeria’s Economy to Grow by 2.7%

The International Monetary Fund (IMF), has decreased the expected growth rate of Nigeria for 2022 to 2.7% . The IMF also estimated the global economy to grow by  4.4% in 2022, having reduced its outlook for the year.

The IMF revealed this information on Tuesday during its World Economic Outlook (WEO), titled “Rising Caseloads, a Disrupted Recovery, and Higher Inflation”.

The international financial institution stated that the decline in forecast is as a result of , border closures and movement restrictions catalyzed by the Omicron variant of the coronavirus. They further added that in 2022, the world economy will be in a debilitated state.

Words from IMF:“As the new Omicron COVID-19 variant spreads, countries have reimposed mobility restrictions. Rising energy prices and supply disruptions have resulted in higher and more broad-based inflation than anticipated, notably in the United States and many emerging markets and developing economies.

“The ongoing retrenchment of China’s real estate sector and slower-than-expected recovery of private consumption also have limited growth prospects,”

The IMF explained that economic growth on a global scale is expected to decline to 4.4% from an initial 5.9% in 2022, this is half a percentage point lesser than in the October World Economic Outlook.

IMF also predicted that by 2023, global growth rate will recess by 3.8%, with 0.2 percentage point above past estimation. The improvement substantially reflects a mechanical pickup after current drags on growth dissipate in the second half of year 2022.

“The emergence of new COVID-19 variants could prolong the pandemic and induce renewed economic disruptions,” they said. Adding that supply chain disruptions, energy price volatility, and localized wage pressures mean uncertainty around inflation and policy paths is high.

They also disclosed that monetary policy for various economies tighten in order to curb inflationary pressure.

“Monetary policy in many countries will need to continue on a tightening path to curb inflation pressures, while fiscal policy—operating with more limited space than earlier in the pandemic—will need to prioritize health and social spending while focusing support on the worst affected.