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HomeBusinessWorld Bank sees Nigeria's economic growth lower to 2.9% in 2023/2024

World Bank sees Nigeria’s economic growth lower to 2.9% in 2023/2024

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The World Bank has stated that Nigeria’s economic growth is expected to decline to 2.9 percent in 2023 and sustain the same pace in the following year.

The developmental bank said in its Global Economic Prospects report that growth momentum in the non-oil sector is likely to be restrained by continued weakness in the oil sector.

It also projected that both security challenges and existing production constraints and a decline in oil prices may further hinder recovery in crude output.

“In Nigeria, growth is projected to decelerate to 2.9 percent in 2023 and remain at that pace in 2024—barely above population growth.

“A growth momentum in the non-oil sector is likely to be restrained by continued weakness in the oil sector.

“Existing production and security challenges and moderation in oil prices are expected to hinder a recovery in oil output. Policy uncertainty sustained high inflation, and rising incidence of violence are anticipated to temper growth. Growth in agriculture is expected to soften because of the damage from last year’s floods.

READ ALSO: Nigeria to offer new oil blocks in a fresh deep offshore mini-bid round

“A fiscal position is expected to remain weak because of high borrowing costs, lower energy prices, a sluggish growth of oil production, and a subdued activity in the non-oil sectors,” the bank said in the report.

On the growth rate projection in Sub-Saharan Africa, the development bank stated that the economy would like grow by 0.2 percentage point before picking up to 3.9 percent in 2024.

The bank said growth in SSA is projected to edge up in 2023 to 3.6 percent—a 0.2 percentage point downward revision from the June forecast—before picking up to 3.9 percent, in 2024.

According to the report, even though an expected moderation of global commodity prices should temper cost-of-living increases, tighter policy stances to address elevated inflation and public debt will weigh on domestic demand.

Meanwhile, weakening growth in advanced economies and China is expected to pose headwinds for external demand, particularly among exporters of industrial commodities.

Constrained access to external financing, tight fiscal space, and high borrowing costs are expected to markedly limit many governments’ ability to spur faster growth.

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