Nairametrics| While the United Kingdom-based financial organization, World Economics, has come out to say that Nigeria’s economy is out of recession and well on its way to recovery, the International Monetary Fund (IMF) continues to cast a subdued outlook on the Nigeria economy in 2017.
World Economics, which is dedicated to producing analysis, insight and data relating to questions of importance in understanding the world economy, hinged its declarations on the Sales Managers’ Index (SMI) for April which rose to 58.5% from 56.7% the previous month. It also indicated that the inflation rate, although still high, had been slowing down recently, the report stated.
“April Sales Managers’ Index (SMI) data suggests that the Nigerian economy is continuing to grow out of the recession which saw 10 months of consecutive contraction in 2016. The Market Growth Index grew to 58.5 in April as the monthly Sales Growth Index ticked up to 56.7, its highest value since 2015 and representative of rapid growth.” the organization said on its website.
On the other hand, the IMF continued its subdued outlook for Nigeria, as the organization maintained that despite the slight rebound in the price of crude oil in the international market, Nigeria ’s economy remains in the zone of crisis, as returns from the commodity fall short of capacity to push the needed growth.
Speaking on the sidelines of the ongoing IMF/World Bank Spring meetings in the United States, IMF’s Economic Counsellor and Director of Research, Maurice Obstfeld, said Nigeria is still reeling under the challenges of 1.5 per cent contraction in 2016 and as such, must make ‘serious adjustments’.
Obstfeld pointed out that sub-Saharan Africa, over which Nigeria is a major influence, will witness only a modest recovery this year, as its growth prospect has been projected to rise to 2.6 per cent in 2017 and 3.5 per cent in 2018, largely driven by specific factors in the largest economies, which faced challenging macroeconomic conditions in 2016.
So who do we believe? Hawkish IMF or Dovish World Economics?