IMF Lowers Nigeria’s 2024 GDP Growth Forecast Amid Economic Challenges

IMF Downgrades Nigeria’s GDP Growth Forecast for 2024 Amid Economic Challenges
The International Monetary Fund (IMF) has revised its projection for Nigeria’s Gross Domestic Product (GDP) growth in 2024, lowering it from an expected 3.3% to 3.1%. This adjustment follows a notable slowdown in economic activities during the first quarter of the year, which saw GDP growth decline to 2.98% from 3.46% in the previous quarter.
The IMF’s latest World Economic Outlook highlights the adverse impacts of recent economic reforms in Nigeria, such as the removal of fuel subsidies and the floating of the currency. These measures have created a challenging environment for manufacturers and traders, exacerbated by limited access to foreign exchange despite interventions from the Central Bank of Nigeria. Inflation has surged to 34.19%, with food inflation reaching a record high of 40.8%.
The Manufacturers Association of Nigeria reported significant distress within the sector, with 767 manufacturers ceasing operations and 335 others becoming distressed in 2023 following President Bola Ahmed Tinubu’s reforms.
Globally, the IMF maintained its economic growth forecast at 3.2% for 2024 and 3.3% for 2025, with a positive outlook on global inflation rates, which are expected to decline from 6.7% last year to 5.9% this year. However, inflation in emerging markets and developing economies is projected to decrease more gradually compared to advanced economies.