The World Bank Tuesday raised Nigeria’s Gross Domestic Product (GDP) growth forecast for 2021 to 1.8 per cent.
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The new forecast is higher than the 1.1 per cent the Bank had estimated for the country this year.
In its June 2021 Global Economic Prospect released Tuesday, the world apex bank also said in the forecast that the GDP growth will hit 2.1 per cent for Nigeria next year.
This was against the 1.8 per cent it had earlier forecast for Nigeria as at January 2021.
The new forecast by the Bank was on the optimism that the
Crude oil prices would be high with government introducing flexible exchange rate regime as well as strucutural reforms.
Part of the forecast reads, “Growth in Nigeria is expected to resume at 1.8 per cent in 2021 and edge up to 2.1 per cent next year, assuming higher oil prices, structural oil sector reforms, and market-based flexible exchange rate management.”
The Bank said in the report that the coronavirus pandemic had contributed to the budget deficit in the country, adding that activities have started picking up.
The Bank stated, “The pandemic has contributed to wider budget deficits and a spike in government debt, heightening the risk of debt distress in some countries. Activity in the three largest economies—Angola, Nigeria, and South Africa— has partially recovered.
“Many industrial and agricultural commodity exporting countries experienced deep contractions last year. In tourism reliant countries, international arrivals have been at a near-halt, and tourism is likely to remain slow until wider vaccination permits safe reopening to international travel.
“Despite improvement, COVID-19 has continued to have adverse impacts on health, schooling, investment, and economic growth.”