IMF: Nigeria’s economic decline affects low income developing countries

The International Monetary Fund (IMF) says Nigeria is responsible for the lion share of economic decline experienced by low income developing countries across the world.

In its World Economic Outlook (WEO) unveiled on Tuesday in Washington, the Bretton Woods institution said Nigeria’s drastic economic decline from 2011 to 2016 highly affected that basket of countries.

“For emerging market and developing economies as a group, the decline in growth between 2011 and 2016 was 2.2 percentage points, with about two-thirds of this decline attributable to weaker growth in commodity exporters —the rest being accounted for by slower growth in China and in other emerging market and developing economies,” the report read in part.

“Commodity exporters account for most of the projected pickup in emerging market and developing economy growth in 2017–19, even though their projected growth recovery is relatively modest compared with the striking decline in their growth rates over the past five years.

“A broadly similar picture holds for low-income developing countries. The Lion’s share of the 1.6 percentage point decline in growth between 2011 and 2016 is attributable to the drastic slowdown in Nigeria, an oil exporter that in 2016 accounted for more than 20 percent of purchasing-power-parity GDP of low-income countries and about half of the GDP of commodity exporters in this country group.”

The IMF goes on to explain that Nigeria has a strong hold on the growth projections of this category of countries, suggesting that growth in Nigeria will lead to “windfall gains” in this category.