The World Bank has lessened its economic growth report for Nigeria in 2023 to 3.2% from 3.3% experiencing a slowdown in international growth, it was reported that the crisis in Ukraine and reduced imports by china for commodities manufactured in Africa.
Forecasting similar factors, the World Bank also estimated that the Sub-Saharan Africa areas will experience a lesser economic development of 3.3 per cent in 2022 from the previous 4.1% recorded in 2022.
Following the reports, the World Bank urged governments in the Sub-Saharan regions to immediately take drastic measures to reestablish macroeconomic equilibrium as well as protect the less privileged in a situation of slow growth amidst high inflation rates in the regions.
The forecast were incorporated in the recent October edition of Africa’s Pulse, a biannual analysis of the near-term regional macro-economic view and economic development in the (SSA) Sub-Saharan Africa conducted by the World Bank.
Specifying developmental factors focused on the Nigerian economy the World Bank noted that “The Nigerian economy forecasted to drop in 2023, lowers to 3.2% (from 3.3%) and remains at this percentage through next year.
According to the recent analysis, growth will be replenished in private consumption due to approved monetary principles as pressures due to inflation subsides.
“Individual consumption expenses is forecast to reduce in 2022 and grow in 2023. This report is likely to repeat itself in 2024. Also, growth of 5.1 per cent will be realized with the large refinery project”.
During the forecast the World Bank noted that the” Economic growth in Sub-Saharan Africa (SSA) shows signs of declaration from 4.1% in 2021 to 3.3% in 2022, a downward review of 0.3% since Pulse forecast in April, this resulted due to reduced demand from china for goods manufactured in Africa.
The World Bank reiterated that “The war in Ukraine is has caused high inflation as well as preventing economic activities by staggering both household consumption and business investments.
As of July 2022, 29 out of 33 nations in SSA had inflation rates of over 5% while about 17 countries had theirs above 10%.
“Increased cost of feed commodities are creating serious negative results in many food – insecure countries.
Hunger has slightly increased in SSA in recent times caused by extreme weather conditions, conflicts and violence as well as economic shocks.
Statements released from the analysis shows that people undergo hardship from hunger and estimated 120 million people in 2022.
In numerous countries, public savings has been spent by earlier schemes to balance the economic depletion generated by the COVID-19 pandemic.
Though resource-rich nations have profited from increased prices of goods and strived to manage their balance sheet.
“Debt is projected to maintain a percentage of 58.6% of GDP in 2020 in Sub-Saharan regions.
Various governments in Africa use 16.5% of their net income to pay the external debt in 2021.
Up from below 5% in 2010. Tightening global conditions has caused the devaluation of African currencies and increased borrowing costs.
The government is urged to make use of existing resources as well as optimise taxes to curtain the above challenges, they are also called upon to reactivate income-generating sectors in order to provide high returns.
The SSA regions are encouraged to invest in agricultural activities as it has the potential to bring returns 10 times greater than the investment injected.
Creating a better environment for agricultural businesses among others could increase long-term food security in a region that depends largely on imports as a source of food.
