By Special Correspondent
Abuja, Nigeria (CWBN)_ The International Monetary Fund (IMF) said in a statement that the Nigerian economy would recover to its pre-pandemic level within the next two years.
The forecast was a part of a report by an IMF staff team led by Jesmin Rahman following a virtual mission from October 30 to November 17, 2020. The mission was carried out in accordance with the 2020 Article IV Consultation with Nigeria.
The IMF concluded that under current policies, the economic outlook in Nigeria under the current policies was challenging.
The IMF said, “Real GDP (Gross Domestic Product) is projected to contract by 3¼ per cent in 2020. The recovery is projected to start in 2021, with subdued growth of 1½ per cent and output recovering to its pre-pandemic level only in 2022.
“Despite an expected easing of food prices, inflation is projected to remain in double-digits and above the Central Bank of Nigeria’s target range, absent monetary policy reforms.”
The statement said that given the substantial reduction in returns collections from the pre-pandemic levels, the lowest in the world, fiscal deficits would remain at the same level in the medium term.
The report concluded that there are major risks resulting from uncertain business environments in Nigeria as well as globally.
The IMF noted the global pandemic was incurred a heavy price on the Nigerian economy, that was already experiencing a reduction in per capita income and double-digit inflation, with limited safeguards and structural constrains.
It said, “Low oil prices and sharp capital outflows have significantly increased balance of payments pressures and, together with the pandemic-related lockdown, have led to a large output contraction and increased unemployment.
