World Bank Slashes Nigeria’s 2022 Growth Forecast To 3.1%

The World Bank has cut Nigeria’s 2022 growth forecast to 3.1 per cent from a previous forecast of 3.8 per cent.

This, according to the bank, is due to Nigeria’s slow economic growth amid declining oil output and reduced non-oil activity.

The bank, in its latest Nigeria Development Update (NDU) released on Thursday and titled ‘Nigeria’s Choice’ said the country’s inflation has worsened since 2020, eroding the purchasing power of Nigerians and increasing poverty.

It said Nigeria’s fiscal pressures had intensified and made worse by the soaring cost of petrol subsidy which will likely exceed N5 trillion this year.

“Despite higher oil export revenues, official reserves have fallen, and the currency market is severely distorted, undermining the business environment and investment. The weaknesses in the macroeconomic policy framework are suppressing growth and making Nigeria more vulnerable to shocks.”

“Nigeria’s economic growth has slowed on the back of declining oil output and moderating non-oil activity. Real gross domestic product (GDP) rose by 3.1 percent year-on-year (y-o-y) in the first three quarters of 2022, little more than the annual population growth of 2.6 percent. Nigeria’s growth performance, and its fiscal and external buffers have decoupled from high oil prices, and macroeconomic vulnerabilities have increased,” the World Bank said.

The Breton Woods institution further revealed that five million Nigerians had fallen into poverty as a result of the 2022 inflation.