The World Bank yesterday announced the lowering of its 2016 growth forecast for Nigeria and other countries in sub-Saharan Africa, to 3.3 per cent from 4.4 per cent in October 2015, citing plunging global commodity prices.
Just last week, the International Monetary Fund (IMF) had also revised Nigeria’s growth forecast downwards to 2.3 per cent from 2.7 per cent growth last year. The IMF attributed the slide to the negative impact of lower oil prices, which is compounded by disruptions to private sector activity through exchange rate restrictions.
According to the Fund, growth in sub-Saharan Africa is expected to remain weak this year at 3.0 per cent, about 0.5 percentage point lower than in 2015, and 1.3 percentage points lower than forecast in its October 2015 World Economic Outlook (WEO). The World Bank said that the commodity price rout, particularly for oil, which fell 67 per cent from June 2014 to December 2015, and a weak global growth were behind the region’s lackluster performance. “Overall, growth is projected to pick up in 2017- 2018 to 4.5 per cent,” it said in a statement.
It stated that a projected rise in economic activity next year would be driven by economic powerhouses of South Africa, Nigeria and Angola, as commodity prices stabilised. Nigeria and Angola are the continent’s top two crude oil exporters whose economies have suffered as a result of sharply lower crude prices. “There were some bright spots where growth continued to be robust such as in Cote d’Ivoire, which saw a favourable policy environment and rising investment, as well as oil importers such as Kenya, Rwanda and Tanzania,” it said.
