Nigeria's economy to rise 0.8 per cent in 2017

by Edgar Hayes April 19, 2017, 1:39
Nigeria's economy to rise 0.8 per cent in 2017

The International Monetary Fund (IMF) says rise in oil prices, continued growth in agriculture, and big government spending will drive Nigeria's economic growth to 0.8 percent in 2017.

Meanwhile, the International Monetary Fund held its 2017 USA growth forecast steady at 2.3 percent, which still represents a substantial jump from 1.6 percent growth in 2016, partly due to expectations that President Donald Trump will cut taxes and increase government spending.

"At the same time, a combination of adverse weather conditions and civil unrest threaten several low-income countries with mass starvation".

Maurice Obstfeld, IMF's economic counselor and director of the research department, said on Tuesday that momentum in the global economy has been building since the middle of last year, allowing the IMF to reaffirm its earlier forecasts of higher global growth this and next year.

Nikita Shah, global economist at analyst firm Capital Economics, noted that despite the IMF's previous "optimistic bias", the firm believes its current forecasts for growth are "about right".

Morocco's economic growth is forecast to jump from 1.5 percent last year to 4.4 percent this year, while Tunisia's economy is seen expanding by 2.5 percent compared with just one percent the year before.

Forecast for advanced economies was marked up 0.1 percent in 2017 to 2 percent while the forecast for 2018 remains unchanged also at 2 percent. "But even as things look up, the post?World War II system of global economic relations is under severe strain despite the aggregate benefits it has delivered - and precisely because growth and the resulting economic adjustments have too often entailed unequal rewards and costs within countries", he said.

"Protectionist policies in advanced economies would have an overall negative impact in Asia including the Philippines but the magnitude of impact and channels would depend on the specific policies that are still uncertain", he said.

The threat of protectionism is the most worrying, but others include as-yet undetermined United States policies and their impact on the global economy, especially the possibility for a rising deficit and tearing down of financial regulations erected in the wake of the 2008 global crisis.

Australia's unemployment rate is set to plunge from 5.9 per cent to 5.2 per cent, well below the 5.5 per cent forecast in the December budget update.

The outlook has also improved for Europe and Japan based on a cyclical recovery in global manufacturing and trade that started in the second half of 2016.

Global trade has fostered "economic miracles" around the world, driving growth and lifting millions out of poverty, he stressed.

Threats to global trade and integration, however, were given the most emphasis by Obstfeld.

The reference to the threats posed by protectionist choices in the USA is clear.

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