IMF Cautions on Nigeria's Economic Outlook

Nigeria: The International Monetary Fund (IMF) has maintained its forecast of 3.3% economic growth for Nigeria in 2024, reflecting a slight improvement compared to 2.9% growth in 2023. However, the IMF acknowledges ongoing challenges for the nation's economy. A key concern highlighted by the IMF is the impact of rising food prices on affordability and overall food security. In March 2024, food price inflation reached 40%, placing a significant strain on households.

"While some growth is projected," explained Mr. Axel Schimmelpfenning, the IMF mission chief for Nigeria, "a 3.3% increase only marginally outpaces population growth. This presents a significant challenge for improving living standards for Nigerians."

Another factor impacting the economic outlook is fuel subsidy spending. The IMF estimates that fuel subsidies could reach up to 3% of Nigeria's GDP this year due to the difference between the price consumers pay at the pump and the actual cost. The IMF commends Nigeria's commitment to gradually phasing out these subsidies within the next one to two years.

Source: IMF