IMF Warns Of Global Economic Growth Contraction In 2024

With inflation higher than ever seen in several decades, rising food and energy crisis and general cost-of-living crisis, tightening financial conditions in most economies of the world, and the lingering COVID-19 pandemic made worse by Russia’s invasion of Ukraine, all weigh heavily on the economic outlook for 2023 and going forward.  From all indications, the worst is yet to come.  BUT! For whosoever belief

When men are cast down, then you shall say, There is lifting up

Also, See

Why Nigeria's Food Crisis May Worsen As Inflation soar To Nears Two-decade High

• Overview
• InflationVs High Cost Of Living
• IMFPrediction For the Nigeria Economy
• Disclaimer

Watch Video Here 

Overview

According to the International Monetary Fund IMF, global growth slowed from 6.0 per cent in 2021 to 3.2 per cent in 2022 and it is forecast to further deep, 0.2 points down from July expectations to 2.7 per cent in 2023. This is the weakest growth rate in over a decade except for the global financial crisis and the acute phase of the COVID-19 pandemic. On the opposite side is global inflation which is forecast to rise from 4.7 per cent in 2021 to 8.8 per cent in 2022 but will however decline to 6.5 per cent in 2023 and to 4.1 per cent by 2024.

Inflation Vs High Cost Of Living

Global economic activity is experiencing a broad-based and sharper-than-expected slowdown, with inflation higher than seen in several decades it is only normal for the cost of living to rise with its consequential food crisis, tightening financial conditions around the world. The three largest economies will be the worst hit and for many economic analysts, a recession is knocking hard.

It is then safe to say that the world may be in for a rough ride, with more than a third of the global economy forecast to contract over this year and next amid a rising cost of living, food, and energy crisis fueled by inflation and aggravated by the lingering Russia’s war in Ukraine.

IMF Prediction For the Nigeria Economy

Nigeria has had its fair share of everything negative in the past seven to eight years, insecurity, worsening food shortages, high inflation, and exchange rate. Nigeria currently has one of the world’s inflation rates at over 20 per cent and the dollar is almost N1000 to $1.  Rising interest rates which to me is one of the many blunders of the Central Bank of Nigeria, governed by Godwin Emefiele, threaten businesses and have made it near impossible to borrow for productive ventures.  It has never been that bad in the history of the most populous black nation on earth.  The election is fast approaching and the majority of the youthful population is hoping that Peter Obi, the formal Anambah state governor will be the Messiah. I hope so too but if all these economic indexes are anything to go by, it won’t be easy for anyone who wins the general election next year. So it is time to braze up and properly position yourself to take advantage of the downward economy.

Also, Read: Impending Recession: How To Get Out Of Financial Crisis In 2022

With vast arable land in Nigeria excellent for growing wheat and all kinds of crops, Nigeria still depends largely on wheat importation from Ukraine as well as Russia. This has made the fallout from Russia’s invasion of Ukraine more devastating for the country.  The spiralling cost of the dollar to the Naira which many say is a result of the millions of dollars paid for fuel subsidy as the country depends on 100% fuel importation for local consumption.  The country’s refineries are all moribund, and even the road to the Eleme refinery and the petrol chemical company is currently passable despite several protests from the communities and stakeholders.  

Nigeria is not alone in this; the world economy has been dealt multiple blows by several factors such as mismanagement, the pandemic, and the icing on the cake is the war in Ukraine. See how different countries are projected to fare in next year’s world economic outlook for 2023.

“This year’s shocks will re-open economic wounds that were only partially healed post-pandemic,”

Said International Monetary Fund economic counsellor Pierre-Olivier Gourinchas  

As you can see more than a third of the global economy is headed for contraction, and the three biggest economies; the United States, the European Union, and China, will continue to plunge.

Disclaimer: The video, Images, and tables displayed in this post are property rights of the IMF. You can visit the IMF website at imf.org for details.

Strategies For Building A Successful Business In A Hostile Environment