The economy of Nigeria is predicted to increase. After the 2016 recession, the country has been experiencing some growth although it is a very slow on. Since then, economic growth remains muted. Growth averaged 1.9% in 2018 and remained stable at 2% in the first half of 2019. Domestic demand remains constrained by stagnating private consumption in the context of high inflation (11% in the first half of 2019). On the production side, growth in 2019 was primarily driven by services, particularly telecoms. Agricultural growth remains below potential due to continued insurgency in the Northeast and ongoing farmer-herdsmen conflicts. Industrial performance is mixed. Oil GDP growth is stable, while manufacturing production is expected to slow down in 2019 due to a weaker power sector performance. Food and drink output are expected to increase, likely in response to import restrictions. Construction continues to perform positively, supported by ongoing mega-projects, higher public investment in the first half of the year, and import restrictions.
Growth appeared to gather pace somewhat in the final quarter of 2019, after quickening activity in both the agricultural and industrial sectors propped up a modest expansion in the third quarter. Both the Central Bank’s manufacturing and non-manufacturing PMIs trended higher in Q4 than in Q3, which, coupled with upbeat credit growth in October–November, suggest improved dynamics. Available data, however, indicates that momentum waned at the outset of 2020. The private sector PMI slipped to a six-month low in January on cooling output and new orders growth. Moreover, though secondary sources showed that oil production held relatively stable in January from Q4 levels, plunging global crude prices may have cut into export revenues. Meanwhile, at the conclusion of its Article IV visit on 17 February, the IMF slashed the country’s 2020 growth forecast, noting that the economic recovery remains fragile amid a challenging outlook.