Nigeria Is Exiting Recession But Economy Remains Vulnerable - IMF
It is not yet Uhuru for Nigeria’s economy although it is making an impressive exit out of a recession.
The International Monetary Fund, IMF says the economy remains vulnerable after climbing out of recession in the second quarter of this year.
Economic growth remains sluggish. That has contributed to a cycle of poverty that drives Nigeria’s yawning wealth inequality as well as social unrest, said the IMF.
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“Overall growth is slowly picking up but recovery remains challenging,” the IMF said in a statement about the review.
“Macroeconomic and structural reforms remain urgent to contain any vulnerability. In the absence of new policies, the near-term outlook remains challenging,” the IMF said in a statement.
The IMF made broadly similar statements earlier this year, a sign that little progress had been made.
President Muhammadu Buhari’s government, who swore by his tears and campaigned on vows to fix Nigeria’s economy, has struggled to follow through with plans to reduce the country’s dependence on oil.
“Growth is expected to continue to pick up in 2018 to 2.1%, helped by the full year impact of greater availability of foreign exchange and higher oil production, but to stay relatively flat in the medium term,” said the IMF.
The global lender also said that low oil prices, security issues and a lack of policy all threaten the Nigeria’s economic recovery.
It also noted that “moving toward a unified and market-based exchange rate as soon as possible while continuing to strengthen external buffers would be necessary to increase confidence and reduce potential risks from capital flow reversals”.
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