According to a report by the National Bureau of Statistics (NBS), Nigeria’s GDP fell to 2.31% in the first quarter (Q1) of 2023, a far drop from the 3.52% reported in the fourth quarter (Q4) of 2022.
The NBS report read in part, “Gross Domestic Product grew by 2.31 per cent (year-on-year) in real terms in the first quarter of 2023. This growth rate declined from 3.11 per cent recorded in the first quarter of 2022, and 3.52 per cent in the fourth quarter of 2022. The reduction in growth is attributed to the adverse effects of the cash crunch experienced during the quarter.”
The World Bank, International Monetary Fund (IMF) and the African Development Bank (AfDB) had all given an optimistic projection as the bodies expected Nigeria’s economy to soar during the review period but the naira crisis hampered that.
The introduction of the naira redesign policy by the Central Bank of Nigeria, (CBN), a move to mop up excess cash in circulation has turned out to be the self-inflicted wound the country's economy has to deal with.
In its African Pulse report, April 2023 edition, the World Bank projected Nigeria's economy to grow by 2.8% in 2023.
The IMF on its part, maintained its forecast of 3.2% growth for Nigeria’s economy in 2023 in its World Economic Outlook report for April 2023.
For the AfDB, Nigeria’s GDP was expected to shoot up to 3.1% in 2023 although the bank highlighted issues like policy continuity after the recently held presidential elections, and rising insecurity as issues that would negatively affect the prospects.
Experts have, however, predicted that the GDP’s downward acceleration may continue for the rest of the year due to the rising inflation, CBN’s strong monetary policies, pressures associated with the country's FX market and other issues which would affect domestic consumption, trade, investment and output.