The International Monetary Fund (IMF) has revised the prediction it initially made for the Nigerian economy. It now admits that Nigeria’s economy will perform below expectation and probably shrink in 2016.

The body’s resident representative in Nigeria said that the delayed signing of the budget, as well as energy shortages disturbed the output of Africa’s largest economy.
After reducing by 0.4 percent in the first quarter of 2016, Leon said Nigeria will experience some growth in the second half of the year. The growth however will not be enough to correct the initial contracting of the economy.

The IMF had originally put its 2016 growth forecast for Nigeria at 2.3 percent in its April   Regional economic outlook, cutting it from the 3.2 percent projected in February. The World Bank similarly lowered its forecast to 0.8 percent last month, blaming weakness from Oil output disruptions and low prices.

Leon said that, “most people would agree that if you should fix one thing in this country, it should be power. There is a need to start changing the power equation from 2016, from today, not tomorrow or later.” He further said that even though inflation would not go beyond 20 percent before the end of 2016, it may surge from its current 15.6 percent in the months ahead.

Folashade Olubayo
Leave a reply