The incoming government in Nigeria must be ready to grapple with a lot of economic odds and must therefore prepare for them, the World Bank, said in its treatise, while unfolding the latest Africa’s Pulse report for April 2023, published on Wednesday.
The global institution, which is said to have just approved an $800million for Nigeria to employ as palliatives in the planned removal of petroleum subsidy, pointedly told the government in the document to buckle up for the daunting challenges it would encounter in office after its inauguration on May 29.
The Independent National Electoral Commission (INEC), had on March 1, declared Asiwaju Ahmed Bola Tinubu as the winner of the February 25 election, and his inauguration is expected to take place on May 29, even though the victory is being challenged in court by Atiku Abubakar of the Peoples Democratic Party (PDP) and Peter Obi of the Labour Party (LP).
In the document, the global institution is predicting a 2.8 per cent economic growth for Nigeria in 2023, which is lower than the 2.9 per cent earlier projected in the bank’s Global Economic Prospects report that was published in January this year.
Part of the report read: “The growth recovery in Nigeria for 2023 (2.8 per cent) is still fragile as oil production remains subdued and the new administration faces many policy challenges.”
The bankw, which also noted that Nigeria was under-performing on long-term growth rates due to weakening performance, especially in the non-oil activity and weak oil production, said: “In Nigeria, oil production picked up in late 2022, thanks to improved security that has so far prevented further oil theft; however, production remains below the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) quota.
“Non-oil economic activity remained weak as the agriculture and industrial sectors experienced a rapid increase in the costs of energy and raw materials that were magnified by a weaker naira in the foreign exchange market.”
Commenting on the CBN’s cashless policy, which weighed on economic activities, the report, added: “The demonetization efforts that started in mid-December are weighing on economic activity. The Stanbic IBTC Bank PMI contracted to 44.7 in February 2023, from 53.5 in January 2022, as business output and new orders were sharply affected by cash shortages.”