Food insecurity, poverty, debt service may hinder Nigeria’s economic growth ─IMF

*The International Monetary Fund, in its recent World Economic Outlook report, says the rising food insecurity, poverty, low vaccination rate, and high debt service have remained a challenge to Nigeria’s economic growth rate

Isola Moses | ConsumerConnect

Despite the country’s proactive approach to contain the novel Coronavirus (COVID-19) infection rates in the last two years, and recent growth improvement, the International Monetary Fund (IMF) has stated that rising food insecurity, poverty, and high debts have remained a challenge to Nigeria’s economic growth rate.

ConsumerConnect reports the pronouncement is contained in its World Economic Outlook (WEO) report the global lender released recently.

In the report, low vaccination rate and high debt service are some of the  downsides to economic recovery in Nigeria.

The Fund stated: “Notwithstanding the authorities’ (Nigeria’s)  proactive approach to contain COVID-19 infection rates and the recent growth improvement, socio-economic conditions remain a challenge.

“Levels of food insecurity have risen and the poverty rate is estimated to have risen during the pandemic.”

The IMF in the report also said: “The outlook faces balanced risks. On the downside, low vaccination rates expose Nigeria to future pandemic waves and new variants, including the ongoing Omicron variant, while higher debt service to government revenues (through higher US interest rates and/or increased borrowing) pose risks for fiscal sustainability.

“A worsening of violence and insecurity could also derail the recovery.”

On the flipside, IMF however, reasons that the non-oil sector and the Dangote Oil Refinery could change the narrative in the West African country.

“On the upside, the non-oil sector could be stronger, benefiting from its recent growth momentum, supportive credit policies, and higher production from the new Dangote Refinery.

“Nigeria’s ratification of the African Continental Free Trade Agreement (AfCFTA) could also yield a positive boost to the non-oil sector while oil production could rebound, supported by the more generous terms of the Petroleum Industry Act (PIA)” 2021.