The International Monetary Fund (IMF) has predicted that the Nigerian economy will be out of recession this year with a growth of 0.8% though it says risks to the recovery remain high. The IMF added that the growth would not be sufficient to reduce unemployment and poverty in the country.
It helpful to note that following four quarters of negative growth, the non-oil economy grew by 0.6% on the back of a rebound in manufacturing and continued Agriculture. Meanwhile as at last month, the Monetary Policy Committee of the Central Bank of Nigeria (CBN) said available forecasts of key macroeconomic indicators pointed to a fragile economic recovery in the second quarter of the year.
The Committee cautioned that the recovery could relapse into a more protracted recession if strong and bold monetary and fiscal policies are not activated immediately to sustain it.
Nigeria slipped into a recession last year as low crude oil prices and production slashed government revenues as well as caused dollar shortages and crippled the Nation’s economy. IMF and the Government saw significant revenue shortfalls in the 1st half of 2017 with interest payments remaining as high as 40% as at the end of June. It projected that interest payments would rise further under current economic policies.
The country has recorded 0.36 and 2.06% contraction in the first and second quarter of 2016 respectively, plunging into its worst recession in 29 years.