Nigeria’s economy will grow by 2.4% on average in 2021-25 but will slow to 2.2% in the 2026-35 period, according to the Centre for Economics and Business Research (CEBR).
In its annual world economic league table of the growth prospects of 193 countries, released on Saturday 26th, the UK-based consultancy group said the country may be in the same position in 2035.
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A steady rise has seen the country move from 38th position in 2005 to 27th position in 2019. However, the CEBR predicts that this rise will halt the projected 2.4% from 2021-25, predicted to decline by 0.2% points from 2026 – 2035.
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What needs to be done
Considering that certain policies appear not to be delivering results and attaining expected outcomes, Nigeria should focus on studying governance models of relevant countries with the intention of comparing and benchmarking their experiences and explore differences and similarities in practice.
This does not imply that Nigeria will copy or import any model; but rather to learn from their experiences and see how they tackled similar problems in the past; and are currently tackling similar problems.
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Key highlights from the report
- Global gross domestic product is forecast to decline by 4.4% this year, in the biggest one-year fall since the second world war.
- The US economy is expected to contract by 5% this year, making China to narrow the gap with its biggest rival.
- China is set to overtake the US to become the world’s biggest economy five years earlier than previously predicted.
- Thanks to China’s “skilful” management of the COVID-19 pandemic, resulting in the country outperforming its rival during the global COVID-19 pandemic.
- CEBR expects the value of China’s economy when measured in dollars to exceed that of the US by 2028.
- World’s pandemic recovery would likely be dominated by higher inflation rather than slower growth – a challenge to governments like Britain’s which have borrowed huge sums to fund COVID responses.
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What you should know
According to the CEBR report and as reported by The Guardian,
- Japan is expected to remain in third place in dollar terms but is likely to be overtaken by India in the early part of the next decade.
- This would push Germany from fourth to fifth place.
- The UK, currently the fifth-biggest economy according to the CEBR, is expected to fall to sixth place by 2024.
- However, GDP in dollars is expected to be 23% higher than that in France by 2035, mainly due to the growing digital economy.
- India, after overtaking France and the UK last year, had fallen back behind the UK as a result of a sharp fall in the value of the rupee. But the dip will be short-lived, with the world’s second most populous country on course to be the third biggest economy by 2035.
- Environmental issues would start to have a serious impact on the shape of the world economy over the next 15 years following a period in which the effects of global heating had become apparent more than previously feared.
- Sea levels are expected to have risen by 45cm from the 2000 base by 2035. This compares with the smaller 20cm rise by 2030 predicted two years ago.
- There would be weaker demand for fossil fuels and lower oil prices. The cost of a barrel of crude would fall below $30 by 2035, considering that more countries are making plans to make the transition to net carbon zero economy in the coming decades.
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What they are saying
The CEBR submitted in the report that:
- “We see an economic cycle with rising interest rates in mid-2020, but the underlying trends have been accelerated by this point to a greener and more tech-based world as we move into the 2030s.”
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Douglas McWilliams, the CEBR’s Deputy Chairman, said:
- “The big news in this forecast is the speed of growth of the Chinese economy. We expect it to become an upper-income economy during the current five-year plan period (2020-25). And we expect it to overtake the US a full five years earlier than we did a year ago. Other Asian economies are also shooting up the league table. One lesson for western policymakers, who have performed relatively badly during the pandemic, is that they need to pay much more attention to what is happening in Asia rather than simply looking at each other.”
