Nigeria’s Economic system Might Drop to Fourth Largest in Africa – IMF
Nigeria’s financial system, which ranked as Africa’s largest in 2022, is ready to slide to fourth place this yr after a sequence of foreign money devaluations, Worldwide Financial Fund forecasts present.
The IMF’s World Financial Outlook as reported by Bloomberg, estimated the nation’s gross home product at $253 billion primarily based on present costs this yr, behind North African powerhouses Algeria at $267 billion, Egypt at $348 billion, and South Africa at $373 billion.
The report added that South Africa will stay the continent’s largest financial system till Egypt reclaims the mantle in 2027. Nigeria nonetheless is anticipated to stay in fourth place for years to return, the information launched this week reveals.
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Nigeria has been battling financial challenges since President Bola Tinubu introduced important coverage reforms together with the tip of the subsidy regime and the devaluation of the Naira. Regardless of a current rebound, the foreign money continues to be 50% weaker towards the buck than it was earlier than taking workplace after two foreign money devaluations.
Egypt, one of many rising world’s most-indebted nations and the IMF’s second-biggest borrower after Argentina, has additionally allowed its foreign money to drift, triggering an nearly 40% plunge within the pound’s worth towards the greenback final month to draw funding.
In contrast to Nigeria’s naira and Egypt’s pound, the worth of South Africa’s rand has lengthy been set within the monetary markets and it has misplaced about 4% of its worth towards the greenback this yr. Its financial system is anticipated to learn from enhancements to its vitality provide and plans to deal with logistic bottlenecks.