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How Nigeria stands among world economies in 2024

Nigeria is showing commendable economic resilience with a projected real GDP growth rate of 3.2 per cent in 2024, outperforming many of its peers among emerging markets and developing economies. Nigeria’s economy is projected to grow at a moderate pace over the next few years, according to recent estimates from the International Monetary Fund (IMF).

Despite facing substantial challenges, the country is expected to maintain a positive trajectory in its Gross Domestic Product (GDP) while grappling with significant inflation, unemployment and a fluctuating current account balance.

Economic Performance Overview

Real GDP Growth: Nigeria’s real GDP growth is forecasted to reach 3.2 per cent in 2024, demonstrating a strong recovery trajectory. This growth rate positions Nigeria as one of the top performers among emerging markets, reflecting effective policy measures and robust domestic demand.

Also read: Nigeria’s GDP Growth Rate Increases, Hits 2.51% in Q2 2023

The report, “World Economic Outlook,” obtained by Arbiterz, notes that Nigeria’s gross national savings increased to 26.32 per cent of Gross Domestic Product in 2024, up from 24.61 per cent in 2023. Total investment also rose to 25.75 per cent of GDP in 2024, compared to 24.28 per cent in 2023.

Inflation Rate: Nigeria continues to grapple with high inflation rates, which currently stands at 33.69 per cent, according to the National Bureau of Statistics. This rate is significantly higher than the global average, indicating persistent price pressures that could undermine economic stability if not managed effectively.

Current Account Balance: Nigeria’s current account balance is projected to remain relatively stable, highlighting a balanced approach to trade and foreign investments. This stability is crucial for maintaining investor confidence and supporting economic growth.

According to the IMF, Nigeria’s current account balance has experienced a surplus of $1.432 billion in 2024, an improvement from the $1.21 billion surplus recorded in 2023.

Also read: Nigeria’s Inflation Rate Hits 24.08% in July 2023

A country’s current account balance represents the combined total of its trade balance, net income, direct transfers, and asset income, providing a comprehensive picture of its international economic transactions.

The report added that Nigeria’s gross national savings increased to 26.32 per cent of Gross Domestic Product, up from 24.61 per cent in 2023. Total investment also rose to 25.75 per cent of GDP in 2024, compared to 24.28 per cent in 2023.

Unemployment: Unemployment in Nigeria remains elevated, posing a critical challenge for inclusive economic growth and social stability. The high unemployment rate highlights the need for job creation initiatives and economic reforms to absorb the nation’s growing labour force.

Comparative Analysis with Top 5 Economies

1. China

  • Real GDP Growth: 4.7 per cent
  • Inflation Rate: 2.5 per cent
  • Current Account Balance: 1.0 per cent of GDP
  • Unemployment Rate: 5.3 per cent

China leads with a robust GDP growth forecast of 4.7 per cent, driven by strong industrial output and technological advancements. Its inflation and unemployment rates are comparatively low, reflecting a well-managed economic environment. This positions China favourably in terms of economic stability and growth potential.

2. India

  • Real GDP Growth: 6.0 per cent
  • Inflation Rate: 5.0 per cent
  • Current Account Balance: -1.0 per cent of GDP
  • Unemployment Rate: 7.5 per cent

India is expected to achieve the highest GDP growth among the top economies at 6.0 per cent, fuelled by a booming services sector and substantial foreign investments. However, its current account deficit and relatively high inflation are areas of concern that could impact long-term economic stability.

3. United States

  • Real GDP Growth: 2.1 per cent
  • Inflation Rate: 3.2 per cent
  • Current Account Balance: -3.5 per cent of GDP
  • Unemployment Rate: 4.2 per cent

The United States exhibits moderate GDP growth, with inflation under control and a manageable unemployment rate. However, the significant current account deficit highlights the need for balanced trade policies to ensure sustainable economic growth.

4. Brazil

  • Real GDP Growth: 2.5 per cent
  • Inflation Rate: 4.0 per cent
  • Current Account Balance: 0.2 per cent of GDP
  • Unemployment Rate: 8.0 per cent

Brazil’s economic growth is moderate, with manageable inflation and a positive current account balance. Nonetheless, the high unemployment rate remains a critical issue that needs addressing through targeted economic and social policies.

5. Russia

  • Real GDP Growth: 1.8 per cent
  • Inflation Rate: 4.5 per cent
  • Current Account Balance: 2.0 per cent of GDP
  • Unemployment Rate: 5.6 per cent

Russia shows modest economic growth, with a relatively stable macroeconomic environment. Its significant current account surplus reflects strong export performance, especially in the energy sector. However, managing inflation and unemployment remains essential for long-term economic health.

Nigeria’s Positive Outlook

Nigeria’s economic outlook for 2024 is promising, with robust GDP growth projected at 3.2 per cent. However, high inflation and unemployment pose significant challenges that need comprehensive and sustained policy interventions.

Compared to top global economies like China, India, the United States, Brazil, and Russia, Nigeria shows strong growth potential but must address its macroeconomic imbalances to ensure sustainable development.

Policy Recommendations

  1. Economic Diversification: Continued efforts to diversify the economy away from oil dependency are crucial. Investments in agriculture, technology, and manufacturing can create more robust economic foundations.
  2. Inflation Control: Implementing monetary policies to curb inflation is essential. This may involve adjusting interest rates and improving supply chain logistics to reduce costs.
  3. Fiscal Discipline: Enhancing fiscal policies to manage public debt and optimise government spending will help stabilise the economy.
  4. Employment Initiatives: Developing programmes to increase job opportunities, especially for the youth, will be vital in reducing the high unemployment rates.

Samuel Bolaji

Samuel Bolaji holds a Master of Letters in Publishing Studies from the University of Stirling, Scotland, United Kingdom, and a Bachelor of Arts in English from the University of Lagos, Nigeria. He is an experienced researcher, multimedia journalist, writer, and Editor. He is currently the Editor of Arbiterz.

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