The International Monetary Fund (IMF) has warned that economic activities in Nigeria will slow down further in Nigeria and across the world as nations use fiscal and monetary instruments to tame rising food prices.
The Washington-based institution on Tuesday in its World Economic Outlook (WEO) for October 2022 titled, “Countering the Cost-of-Living Crisis,” downgraded Nigeria’s economic growth projection to 3.2 percent in 2022.
The development is 0.2 percentage points lower than the 3.4 percent projected in its July 2022 report.
The report also downgraded the economic growth projection for sub-Saharan Africa from 3.8 percent to 3.6 percent, citing tighter financial and monetary conditions.
READ ALSO: FG’s utilization of IMF $3.4billion SDR fund shrouded in mystery – Expert
“In sub-Saharan Africa, the growth outlook is slightly weaker than predicted in July, with a decline from 4.7 percent in 2021 to 3.6 percent and 3.7 percent in 2022 and 2023, respectively — downward revisions of 0.2 percentage points and 0.3 percentage points, respectively,” the report said.
“This weaker outlook reflects lower trading partner growth, tighter financial and monetary conditions, and a negative shift in the commodity terms of trade.”
Unlike sub-Saharan Africa, the report projected that growth in the Middle East and Central Asia would increase to 5.0 percent in 2022.
According to the IMF, this reflects “a favourable outlook for the region’s oil exporters and an unexpectedly mild impact of the war in Ukraine on the Caucasus and Central Asia”.
“In 2023, growth in the region is set to moderate to 3.6 percent as oil prices decline and the headwinds from the global slowdown and the war in Ukraine take hold,” it added.
Overall, the IMF said global growth is projected to slow from an estimated 6.1 percent in 2021 to 3.6 percent in 2022 and 2023.