By Dipo Olowookere
The World Bank Group on Tuesday said it expects the Nigerian economy to grow by 2.2 percent in the year 2020.
In a statement yesterday, the global lender said in the Sub-Saharan Africa region, growth is expected to accelerate to 3.3 percent in 2020, with South Africa anticipated to rise to 1.5 percent and Angola to pick up to 2.9 percent next year.
However, the World Bank said these projections would remain “assuming that investor sentiment toward some of the large economies of the region improves, that oil production will recover in large exporters, and that robust growth in non-resource-intensive economies will be underpinned by continued strong agricultural production and sustained public investment.”
It added that, “While per capita GDP is expected to rise in the region, it will nevertheless be insufficient to significantly reduce poverty.”
Business Post reports that the World Bank has observed that in 2019, activities, especially trade, in the emerging market and developing economies, which Nigeria belongs to, has been markedly weaker than expected, with a substantial softening in external demand, heightened global policy uncertainty, and subdued investment only partially offset by recent improvements in external financing conditions.
“As demand from major economies continues to moderate, export growth is expected to decelerate across EMDE regions in 2019.
“Overall, export growth in 2019 is expected to be below historical averages in more than 80 percent of EMDEs. Trade in Asia—which contains major, tightly interconnected, global manufacturing hubs—has been particularly affected,” the World Bank said yesterday.
It noted that growth in emerging market and developing economies is expected to stabilize next year as some countries move past periods of financial strain, but economic momentum remains weak.
“Emerging and developing economy growth is constrained by sluggish investment, and risks are tilted to the downside.
“These risks include rising trade barriers, renewed financial stress, and sharper-than-expected slowdowns in several major economies, the World Bank says in its June 2019 Global Economic Prospects: Heightened Tensions, Subdued Investment. Structural problems that misallocate or discourage investment also weigh on the outlook,” the statement said.
On the global scene, the World Bank said economic growth is forecast to ease to a weaker-than-expected 2.6 percent in 2019 before inching up to 2.7 percent in 2020.
“Stronger economic growth is essential to reducing poverty and improving living standards,” said World Bank Group President David Malpass. “Current economic momentum remains weak, while heightened debt levels and subdued investment growth in developing economies are holding countries back from achieving their potential. It’s urgent that countries make significant structural reforms that improve the business climate and attract investment. They also need to make debt management and transparency a high priority so that new debt adds to growth and investment.”
Growth among advanced economies as a group is anticipated to slow in 2019, especially in the Euro Area, due to weaker exports and investment. U.S. growth is forecast to ease to 2.5 percent this year and decelerate to 1.7 percent in 2020. Euro Area growth is projected to hover around 1.4 percent in 2020-21, with softness in trade and domestic demand weighing on activity despite continued support from monetary policy.
