Last week, the National Bureau of Statistics or NBS released a report that showed that Nigeria’s gross domestic product or GDP grew by 3.98% in the fourth quarter of 2021.
The NBS said the increase showed “sustained positive growth” since the recession of 2020 that saw the country’s GDP shrink by -6.10% and -362% in the second and third quarters of 2020, respectively.
Now, a new global report released today by Allianz, a Germany-based insurance and assets management-focused corporation, says Nigeria’s GDP is expected to grow by a further 2.3% in 2022.
The Allianz Economic Outlook report, however, says Nigeria’s GDP growth by the end of the year would be lower than that of countries like Senegal, Kenya, Ivory Coast, and Ghana, but higher than the numbers for Angola and South Africa.
“GDP growth expectations in countries are as follows: Senegal (6.1%), Kenya (5.6%), Ivory Coast (5.5%), Ghana (5.4%), Egypt (4.6%), Mozambique (4.6%), Namibia (3.7%), Morocco (3.3%), Tunisia (3.2%), Gabon (3.2%), Algeria (2.4%), Nigeria (2.3%), Angola (2.2%) and South Africa (2.0%),” it said.
Overall, the report said the continent would record a “mild growth” at +3.5%.
The research suggests that the mild growth would be partly due to rising inflation increasing monetary policy rates in Nigeria and other African countries.
“…amid rapidly rising inflation to double digits in most countries, monetary policy rates are expected to increase in Kenya, Nigeria, Ghana, South Africa and Egypt. In an environment of continued sanitary uncertainty, this monetary tightening is expected to put a brake on growth,” it said.
It predicts that food security situations would worsen in conflict and climate events-torn southern and eastern Ethiopia, Kenya and Somalia, as energy prices and food inflation continues to bite hard in other African countries like Nigeria, Ghana, and Angola.
Recall that Nigeria’s National Bureau of Statistics reported last week that the country’s food inflation dropped by 3.44% to 17.13% in January 2022 from 20.57% in January 2021.
But Allianz Economic Outlook also warned that Ethiopia’s “deteriorating security situation” could make things worse in the region because it “entails significant risk of spillovers to the region, including migration flows to the Kenyan border.”
It described Tunisia, Ghana, Mozambique, Kenya and South Africa as “hot spots regarding debt sustainability”, with Tunisia, Morocco, Egypt, and Burkina Faso expected to see current account deficits only improve slightly in 2022 after deteriorating in 2021.
On the global stage, it said growth is expected to remain “robust but uneven”, with developed countries gaining more due to “rising divergence between advanced and emerging market economies.”
The Eurozone is expected to see a growth of +4.1% and the US to grow at +3.9%. China’s growth will slow to about +5.2% due to current disruptions in the real estate sector and the government’s fixation on financial stability.
Because of China’s influence on emerging markets, its lowered growth is likely to affect those markets negatively, the report said.
In all, global trade in volume is expected to grow by +5.4% in 2022 and +4.0% in 2023.