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CBN counters FG, IMF growth projection for Nigeria’s economy, rolls out sources of shocks

  • Business

The Central Bank of Nigeria (CBN) has countered the projections of the Federal Government and the International Monetary Fund (IMF) for Nigeria’s economy in 2023.

On Tuesday, the central bank said Nigeria’s economy would grow at a slower pace than projected by the Nigerian government and the global financial body.

According to the apex bank boss, Godwin Emefiele, the CBN’s Monetary Policy Committee (MPC) projected that the country’s economy will grow by 2.88 per cent in 2023, against the 4.2 per cent and 3 per cent projected by FG and IMF.

“Available data and forecast for key macroeconomic indicators for Nigeria suggest that the economy will continue to grow through 2023, but at a subdued pace,” Emefiele said during the post-MPC meeting held in Abuja.

He added that, “the economy is forecast to grow in 2023 by 2.88 per cent by the CBN estimate, 4.2 per cent Federal Government estimate, and 3 per cent by the IMF estimate.”

Read also:NASS urges CBN to extend deadline for old notes by six months

Key sources of shocks to the Nigerian economy

Emefiele said Nigeria’s economy is exposed to risk from the Russia-Ukraine war, heighten inflationary pressure across several economies, as well as return of COVID-19 in China that has led to sharp slow down of economic activities in the Asian country.

He named rising debt levels, high level of insecurity, scarcity of Premium Motor Spirit (PMS) and increased spendings towards the general election as other key shocks to the Nigerian economy.

“The key risk remains the lingering headwinds from Russia-Ukraine war, heighten inflationary pressure across several economies and sharp slow down of economic activities in China, with the resurgence of COVID-19 pandemic across its major cities.

“Other reasons are heighten of external financial conditions as monetary policy normalisation continues, increasing risk of global debt crisis as both corporate and public debt levels burgeon and rising risk of a global recession in 2023,” the apex bank stated.

The financial regulator stated further “The continued high level of insecurity, scarcity of Premium Motor Spirit (PMS) and high cost of other energy sources, increased spendings towards the general election, rising cost of debt services, and deteriorating fiscal balances remain the key sources of shocks to the Nigerian economy.”

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