The International Monetary Fund (IMF) has expressed optimism about Nigeria’s engagement with the global debt market, despite the challenges posed by high borrowing costs.
According to Tobias Adrian, IMF’s Financial Counsellor and Director of Monetary and Capital Markets, “Frontier markets, including Nigeria, have been active in the debt market this year, and though access to financing is still more expensive than before, the overall issuance levels have been encouraging.”
The IMF also commended Nigeria’s recent monetary policy measures, particularly the Central Bank of Nigeria’s (CBN) interest rate hikes and foreign exchange reforms aimed at stabilizing the economy.
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Adrian noted that the CBN’s shift toward inflation targeting and efforts to liberalize the exchange rate has been crucial in addressing inflation, which remains close to 30%.
However, the IMF revised its economic forecast for Nigeria, projecting a slowdown in the country’s growth for 2024.
The international lender noted that “the revision reflects slower growth in Nigeria, amid weaker-than-expected activity in the first half of the year.”
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The latest World Economic Outlook report reveals that Nigeria’s economy is expected to grow at 2.9% in 2024, maintaining the same growth pace recorded in 2023.
This projection is a 0.2% decrease from the previous projection in July and a 0.4% decrease from the previous projection in April.
Jean-Marc Natal, Deputy Chief of the IMF’s Research Department, attributed the revised growth forecast to disruptions in agriculture and oil production.
“We revised growth for Nigeria 2024 by 0.2% down. Things are volatile because the reason for the revision is precisely issues in agriculture related to flooding and issues in the production of oil, related to security and maintenance that have pushed down the production of oil.”
On a positive note, the IMF projects a 3.2% growth for Nigeria in 2025, which is 0.2% higher than the projections made in July and April this year.
