World Economy

Nigeria Will Outpace S. Africa Growth

Nigeria is expected to muster just 0.8% in 2017, but will grow 1.9% in 2018.Nigeria is expected to muster just 0.8% in 2017, but will grow 1.9% in 2018.

The International Monetary Fund has projected that Nigeria’s economy will grow at a faster pace than South Africa’s in 2018. According to its World Economic Outlook for July 2017, the IMF said Nigeria will grow at 1.9% in 2018, while South Africa will only climb by 1.2%.

In 2016, the Nigerian economy contracted by 1.6%, while South Africa expanded by 0.3%. Projections for 2017 put South Africa’s growth at 1%, while Nigeria is expected to muster just 0.8%, AllAfrica reported.

“In Sub-Saharan Africa, the outlook remains challenging. Growth is projected to rise in 2017 and 2018, but will barely return to positive territory in per capita terms this year for the region as a whole—and would remain negative for about a third of the countries in the region,” the IMF said.

“The slight upward revision to 2017 growth relative to the April 2017 WEO forecast reflects a modest upgrading of growth prospects for South Africa, which is experiencing a bumper crop due to better rainfall and an increase in mining output prompted by a moderate rebound in commodity prices.

“However, the outlook for South Africa remains difficult, with elevated political uncertainty and weak consumer and business confidence, and the country’s growth forecast was consequently marked down for 2018.”

IMF also added that global growth will be aided by growths in the US and the UK, projected to grow at 2.1% and 1.5% respectively. “China’s growth projections have also been revised up (6.7%), reflecting a strong first quarter of 2017 and expectations of continued fiscal support.

“Inflation in advanced economies remains subdued and generally below targets; it has also been declining in several emerging economies, such as Brazil, India, and Russia.”

Meanwhile, Fitch Ratings has affirmed Lagos state’s long-term foreign and local currency issuer default ratings at ‘B+’ with negative outlook and short-term foreign currency IDR at ‘B’. The national long-term rating has been affirmed at ‘AA+’, with a stable outlook. The ratings on Lagos’ medium-term note program as well as senior unsecured bonds have also been affirmed at ‘B+’/AA+’.

The affirmation reflects the state’s weak socio-economic indicators by international standards. It also reflects Fitch’s expectations of resilient operating performance in the medium term, adequate transparency compared with national standards and satisfactory debt metrics.



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