‘Nigerian economy will outpace South Africa’s in 2016’
Amid growing uncertainty from economic challenges facing Nigeria, the International Monetary Fund (IMF) has said that the economy will grow faster than South Africa’s in 2016.
According to IMF, Nigeria’s Gross Domestic Product’s growth will fall from 2.8 per cent in 2015, to 2.3 per cent in 2016, but will still be higher than South Africa’s 0.6 per cent early this year.
The international financial institution slashed South Africa’s gross domestic product (GDP) growth rate from 0.6 percent to 0.1 percent in 2016.
“Growth in 2016 is expected to decline further to 2.3 per cent, with non-oil sector growth projected to slow from 3.6 per cent in 2015 to 3.1 per cent in 2016 before recovering to 3.5 per cent in 2017,” IMF said.
However, the new review of South Africa’s economy has shown another slash in the expected growth.
“And while electricity supply has improved, growth continues to be held back by deep-rooted structural problems such as poor education outcomes, and product and labour markets that are out of reach for too many people,” IMF said.
The report showed that the country’s growth slowed to 1.3 per cent in 2015, the lowest since the global financial crisis and below most emerging market economies and commodity producers.
The IMF projects 2016 growth at 0.1 per cent, which would mean a second year of falling per capita incomes.
Despite IMF’s forecast for Nigeria’s GDP, first quarter results in Nigeria showed a shrinking in growth to -0.36 percent, the lowest in 25 years.
Global economic growth has been challenged by fall in commodity prices, Chinese slowdown and most recently, Brexit.