Nigeria Economic Outlook

Posted by Airxons Limited (airxons) | 1/31/2019 | Finance

Incoming data suggests that the recovery is back on track in the second half of the year

Incoming data suggests that the recovery is back on track in the second half of the year, after GDP growth dropped notably in Q2. Pipeline disruptions, which had plagued oil output in Q2, have dissipated and the ministry of petroleum announced that oil production rose to over 2.0 million barrels per day in September. In addition, fiscal spending has ramped up as the delayed 2018 budget kicks in, while the PMI pointed to solid economic conditions in September. That said, the government’s fiscal dynamics are growing worrisome. Despite higher oil prices, international reserves dropped for a third consecutive month in September as the government defends Nigerian assets against capital outflows. Moreover, weak tax collection combined with record spending plans for this year, have forced authorities to turn to international markets for cash, adding to the country’s debt burden.

Nigeria Economic Growth

Growth is expected to gain steam going forward thanks to softer inflation, improved exchange rate liquidity and higher oil output. That said, political uncertainty is high going into the 2019 election and politics will likely put economic reforms on the backburner and delay the 2019 budget. FocusEconomics panelists see GDP increasing 2.7% in 2019, which is down 0.1 percentage points from last month’s forecast. In 2020, the economy is seen expanding 3.4%.

 

 

                                                                                        2013    2014    2015    2016    2017

Population (million)                                                         169.      174.     179.    184.      189


GDP per capita (USD)                                                     3,082.  3,312.  2,766   2,206.  1,995


GDP (USD bn)                                                                 522      576.     494     405       376


Economic Growth (GDP, annual variation in %)              5.5        6.2       2.8      -1.6       0.8


Consumption (annual variation in %)                               21.2      0.5      -0.4      -3.7        -  


Investment (annual variation in %)                                  7.9        13.4      0.6       -6.8        -  


Industrial Production (annual variation in %)                   -0.1       6.0       -3.4      -9.4     -3.6


Unemployment Rate                                                         3.7       4.6        4.3.       7.1      7.0


Fiscal Balance (% of GDP)                                              -1.4       -0.9      -1.6       -2.2       - 


 Public Debt (% of GDP).                                                 12.9       13.1      16.0.   19.6     23.4


Money (annual variation in %)                                         1.3         20.6      5.8       17.8     1.7


Inflation Rate (CPI, annual variation in %, eop)               8.0         8.0        9.6      18.6     15.4


Inflation Rate (CPI, annual variation in %)                       8.5         8.1        9.0       15.7.   16.5


Policy Interest Rate (%)                                                   12.00.    13.00    11.00    14.00  14.00


Exchange Rate (vs USD)                                                155.2      167.5.   196.5.  304.5.  305.5


Exchange Rate (vs USD, aop)                                        155.3.     156.5    192.6.  253.2.  305.3


Current Account (% of GDP)                                           3.7          0.2.       -3.1      0.7       2.8


Current Account Balance (USD bn).                              19.2.        0.9        -15.4.    2.7      10.4


Trade Balance (USD billion)                                           43.8         21.0      -6.4      -0.5     13.1


Exports (USD billion)                                                      95.1         82.6.     45.9.     34.7    45.8


Imports (USD billion)                                                      51.4         61.6      52.3      35.2.    32.7


Exports (annual variation in %)                                      0.8.          -13.2.    -44.4     -24.4.   32.0


Imports (annual variation in %)                                      -3.8          19.9      -15.0     -32.7   -7.3


International Reserves (USD)                                        43.6          34.5       29.1     25.8.    38.8


External Debt (% of GDP)                                              1.7           1.7          2.2       2.8.       5.0

 

Source: https://www.focus-economics.com/countries/nigeria