The recently released International Monetary Fund (IMF)’s semi-annual report has revealed that there would be a global growth up to 3.5 percent for this year, one-tenth higher than the January forecast.
Here are highlight of some key predictions IMF made in the report:
- With buoyant financial markets and a long-awaited cyclical recovery in manufacturing and trade, world growth is projected to rise from 3.1 percent in 2016 to 3.5 percent in 2017 and 3.6 percent in 2018.
- World economy will grow faster than previously expected this year thanks to increased trade, investment and manufacturing.
- Stronger activity, expectations of more robust global demand, reduced deflationary pressures, and optimistic financial markets are all upside developments.
- Risks to global growth still remain, as a result of the threat of protectionist policies and structural problems — such as low productivity and high income inequality.
- Economic policies have an important role to play in staving off downside risks and securing the recovery, and a renewed multilateral effort is also needed to tackle common challenges in an integrated global economy.
- Curbing immigration flows would hinder opportunities for skill specialization in advanced economies, limiting a positive force for productivity and income growth over the long term.
- The IMF recommends “well-targeted initiatives” to help workers adversely affected by free trade and other economic changes to “find jobs in expanding sectors” as well as “social safety nets to smooth the loss of income,” and improved education and training in the longer term.
- Global economic activity is picking up speed, but the potential for disappointments remains high, and momentum is unlikely to be sustained in the absence of efforts by policymakers to implement the right set of policies and avoid missteps.
Regarding Nigeria’s economy, the following predictions were made:
- Nigeria will return to growth after an economic decline of 1.5 percent in 2016.
- Nigeria’s economic growth would rise by 0.8 per cent in 2017.
- Continued growth in agriculture, rise in oil output and big government spending will drive the nation’s growth.
- Inflation in 2017 is expected to remain at double-digit levels in a few large economies in sub-Saharan Africa, including Nigeria, Angola and Ghana, reflecting, among other factors, the pass through of large depreciation.