IMF: Nigeria will achieve 3.1% economic growth forecast with stronger reforms

The International Monetary Fund (IMF) says Nigeria can achieve the 3.1 percent economic growth forecast for 2024 by implementing stronger reforms.

Christian Ebeke, IMF resident representative, spoke on Tuesday at the Lagos Chamber of Commerce and Industry (LCCI) International Business Conference and Expo 2024, themed ‘Invest Nigeria’.

On July 16, the IMF reduced its forecast for Nigeria’s economic growth to 3.1 percent in 2024 — down from a 3.3 percent projected in April.

However, Ebeke said for the country to grow slightly from the 2.9 percent rate of 2023, stronger reforms on governance and business regulations are needed.

He said such reforms would transform its growth momentum into something more durable.

“Insecurity, tight financial conditions, multiple taxes, insufficient power and corruption are foremost constraints identified by businesses,” the IMF official said.

“What comforts the IMF is that these issues can be addressed by the Nigerian government, and they are currently being addressed through reforms by the federal government.

“And we are encouraged by the fact that these issues can be reversed.”

He further said Nigeria should close the structural gaps like India by reducing governance and business regulation bottlenecks by 25 percent.

According to Ebeke, if that is achieved, the gross domestic product (GDP) output can be lifted by 6.4 percent in the next three years.

He, however, said the country had recorded progress in its credit market, as well as financial and external sectors.

‘FG PROVIDING INCENTIVES TO DRIVE INVESTMENTS, GROWTH’

Also at the event, Adegboyega Oyetola, minister of marine and blue economy, said Nigeria’s strategic location and abundant resources presented vast investment opportunities.

Oyetola said despite existing challenges, the government was committed to creating an enabling environment to foster economic growth to attract significant investments.

He said one of the government’s incentives designed to drive investment in the marine and blue economy sector is tax exemptions for businesses operating in free trade zones and infrastructural support.

“To boost investment, the Nigerian government has introduced a wide range of incentives, including tax reliefs, trade zone benefits, infrastructure development, and financial support,” Oyetola said.

“I encourage the business community and investors to take advantage of such incentives to contribute to Nigeria’s economic development and be part of Africa’s promising future.”

On his part, Babajide Sanwo-Olu, governor of Lagos, said the state, being Africa’s economic hub, offered a conducive business environment, a strategic location, a vast market, and a pool of energetic talents.

Sanwo-Olu said his administration had implemented and continued to implement policies and initiatives to attract investments, create opportunities, and drive growth.

“We will continue to roll out incentives for investors,” the governor said.

“From tax breaks and waivers, to streamline regulatory processes, and a judicial system that is competent, efficient and guarantees the sanctity of contracts and property rights.”

Speaking on the essence of the event, Gabriel Idahosa, president of LCCI, said the conference was pivotal to Nigeria’s journey towards stabilising the economy and driving sustainable economic growth and development.

Idahosa said Nigeria is blessed with vast resources and an entrepreneurial spirit.

According to Idahosa, Nigeria was home to the largest economy in Africa burgeoning middle class, and a youthful population eager to contribute to the global economy.

“To fully harness the nation’s potential, there must be an enabling environment to support business growth, encourage innovation, and ensure that local and international investors remain confident of their investments,” he said.

Idahosa, however, urged the government to create policies and a regulatory environment to attract foreign investments into building factories in Nigeria to manufacture the many products imported.