By Jemimah Wellington, JKNMedia Reporter
THE INTERNATIONAL Monetary Fund (IMF) has revised its forecast for Nigeria’s economic growth in 2024, lowering it to 3.1 percent.
The reduction follows weaker-than-expected growth in the first quarter of the year.
In its July 2024 World Economic Outlook (WEO), released on Tuesday, the IMF attributed the downgrade to poor economic performance early in the year, JKNewsMedia reports.
Forecast
Despite this, the IMF kept its 2025 forecast for Nigeria at 3.0 percent.
The report also downgraded the growth forecast for sub-Saharan Africa to 3.7 percent from the previous 3.8 percent predicted in April.
The IMF stated that the main reason for this adjustment was Nigeria’s reduced growth outlook.
First Quarter Drop
Nigeria’s Gross Domestic Product (GDP) showed a decline, with first-quarter growth dropping to 2.98 percent from 3.46 percent in the fourth quarter of 2023, as reported by the National Bureau of Statistics (NBS).
Globally, the IMF retained its growth forecasts of 3.2 percent for 2024 and 3.3 percent for 2025.
The report highlighted challenges such as services price inflation and trade tensions, which complicate economic stability and growth.
Surging Inflation
Meanwhile, Nigeria’s inflation rate has surged to 34.19 percent in June 2024, up from 33.95 percent in May 2024, according to NBS data.
The year-on-year increase is significant, with June 2024’s rate being 11.40 percentage points higher than in June 2023.
Food Inflation Rate
Food prices have also risen sharply.
The NBS reported a food inflation rate of 2.55 percent in June 2024, up from 2.28 percent in May 2024.
The increase is due to higher costs of essential items like groundnut oil, palm oil, tubers, and fish.
Government’s Response
In response to the food crisis, the Nigerian government has implemented several measures.
These include suspending duties and tariffs on importing maize, husked brown rice, wheat, and cowpeas for 150 days.
The government has also approved the procurement of 2,000 tractors and 1,200 trailers and established a committee to address food production challenges.
Experts cite insecurity and inadequate equipment as major obstacles to food production in Nigeria.
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