The International Monetary Fund, IMF says the
chances are high that Nigeria’s economy will contract this year as energy shortages and the
delayed budget weigh on output.
“I think
there is a high likelihood that 2016 as a whole will be a contractionary year,”
the IMF Country Representative in Nigeria, Gene Leon, said.
While the economy should look better in the
second half of the year, growth will probably not “be sufficiently fast,
sufficiently rapid to be able to negate the outcome of” the first and second
quarters, he added.
Nigeria’s Gross Domestic Product shrunk by 0.4
per cent in the three months through March, the first contraction in more than
a decade, as oil output and prices slumped and the approval of spending plans
for 2016 was delayed.
A currency peg and foreign-exchange trading restrictions, which were removed
last month after more than a year, led to shortages of goods from fuel to milk
and contributed to the contraction in the first quarter.
Leon said while
conditions that impeded growth in the first half of the year might have been
reduced, they still weighed on the economy, Bloomberg reported.
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