• Monday, February 26, 2024
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Rewane projects 3.3% growth for Nigeria’s economy in 2024

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Bismarck Rewane, chief executive officer at Financial Derivatives Company, has projected that Nigeria’s economy will grow by 3.3 percent in 2024 from 2.61 percent expected for 2023.

This was revealed at the Wealth and Economic Review Webinar hosted by Alpha Morgan Capital on Tuesday.

“Between expectations and forecasts last year and what has happened so far, we see a better picture though not great but a soft landing,” Rewane said during a presentation.

He said there will be mild epic growth next year but that this time last year, everyone was talking about soft landing and inflation has projections “But one week is a long time in politics hence one year is a long term in Economics.”

The renowned economist also projected the country’s inflation to drop to 20.1 percent in 2024 from 28.7 percent in 2023. “The slowdown in inflationary pressures will reduce Nigeria’s imported inflation.”

He noted that Nigeria is becoming more integrated with the global economy but less competitive as the share of its global economy and trade is declining.

“Europe is Nigeria’s largest export trading partner, accounting for 40 percent of total exports,” he said, adding that a slowdown in Europe’s economy could lower the demand for Nigeria’s exports. The lowering of the US interest rates will reduce the strength of the dollar against the naira,” he said.

Read also: NBS report on growth, population signal stagnating economy – Economist

He added that there will be a reduction in capital flight and naira volatility in the country.

“Nigeria will be unable to visit the international market as interest rates will remain elevated,” he said.

He, however, noted that the country will not default on its debt but debt restructuring is imminent.

While speaking about politics in 2024, the economic expert said the president’s time in office will be highly testing, caught in a dilemma of proceeding with market reforms and a weak political mandate.

“The implementation of market and institutional reforms is crucial to putting the Nigerian economy on the path of sustainable growth,” he said.

Rewane said Nigeria’s security situation is fragile, constraining the present administration in pursuing market reforms.

“The present administration will be under pressure from the labour unions,” he said. “The future of the current federal structure is at risk due to widespread, entrenched poverty & and ethno-religious divides.”

While speaking about the global investment landscape in 2024, Rewane stated that a slowing economy and possible recession would likely pressure corporate profits and weigh on asset prices.

He said positive operating leverage and productivity growth from artificial intelligence could contribute to margin expansion.

“Investors expected to deepen positions in securities that offer higher yields and companies with quality cash flows and realistic earnings goals,” Rewane said.

Although Central Banks in advanced economies will begin rate cuts, he said, adding that interest rates will remain elevated.

Rewane said there will be a limit for developing economies to borrow in the international capital market. “Most countries will rely on domestic borrowing to fund expenditure.”