With a new year on the horizon, let’s recall some of the forecasts for Nigeria’s economy that will shape how businesses operate in 2022. This year the IMF, AfDB among other financial institutions made their predictions for what 2022 will look like for Nigeria. Let’s have a look.
What the International Monetary Fund (IMF) Says
The IMF in its Economic Outlook for Sub-Saharan Africa: One planet, two worlds, three stories report, forecasts that Nigeria’s economy will grow at 2.7% by 2022. A growth the body states will be steady and strengthen the GDP per capita.
What the Africa Development Bank (AfDB) Says
Based on a predicted rebound in crude oil prices and output, the AfDB forecasts Nigeria’s economy to increase by 2.9 percent in 2022. Borrowing from its forecast of a 1.5% growth in 2021, we can expect that as global economic conditions continue to improve, increased revenues will help reduce the budget deficit in Africa’s largest economy.
What Statista Says about Nigeria GDP in 2022
According to market and consumer data research firm, Statista projects Nigeria gross domestic product (GDP) to reach $555.35 billion, an upward trajectory for the nation’s economy. This shows that we can expect Nigeria’s economic power to increase in 2022.
A high GDP will mean that Nigeria will have more money to spend on domestic consumption and investment, government expenditure and net export. However there are several shortcomings of using GDP to measure relative wealth, and if the nation must make the most of this positive outlook it must make necessary provisions. A strong GDP can be deceptive for a couple of reasons. It does not account for volunteer work, rebuilding after disasters or pandemics which can increase economic activities, and the third point in focus,
- GDP doesn’t account for quality of goods: Consumers may choose to buy cheap, low-quality, short-lived items over more costly, long-lasting goods on a regular basis. Over time, consumers may spend more replacing low-quality items than they would have if they had purchased higher-quality goods in the first place, and GDP may increase as a result of waste and inefficiency.