Nigeria will witness economic growth in 2024 - IMPI

The Independent Media and Policy Initiative (IMPI) says it is convinced that Nigeria will witness economic growth in 2024, on the basis of the GDP figure of the last quarter of 2023

it said in a statement signed by its Chairman Niyi Akinsiju that it expects the growth to be driven by the non-oil sector and expansion in the financial sector as the Central Bank of Nigeria battles to tame inflation rate and stabilize the foreign exchange rate.

The policy group explained that its position is based on a careful study of the latest GDP figure released by the National Bureau of Statistics (NBS) that also showed a sharp rebound in the oil production after a 3-year contraction.

It said: “According to NBS, real growth of the oil sector spiral upward to 12.11 percent year on year in Q4 2023.

“This indicated an increase of 25.50 percentage points (highest in the last three years) compared to the rate recorded in the corresponding quarter of 2022 which was -13.38 percent. Growth also increased by 12.96 percentage points when compared to Q3 2023 which was -0.85 per cent.”

IMPI said by way of production breakdown, the nation in the fourth quarter of 2023, recorded an average daily oil production of 1.55 million barrels per day (mbpd), higher than the daily average production of 1.34mbpd recorded in the same quarter of 2022 by 0.21mbpd.

“This is higher than the production volume of the third quarter of 2023, which is 1.45mbpd, an increase of 0.10mbpd. This has implications for inflow of foreign exchange because the nation depends on crude oil export for more than 90 percent of its foreign exchange earnings.

“The principal explanation for this impressive crude oil production increase is that the country now has about 30 functioning rigs in its upstream oil and gas sector.

“According to OPEC data, Nigeria’s average rigs count was 11, 7, and 20 in 2020, 2021 and 2022 respectively. Rig count is a measure of vibrant activities in the oil industry. It also referred to the number of active drilling rigs extracting oil from the ground at a given time. It is an important metric in the oil and gas industry as it provides insight into the level of drilling activity, which can influence oil production levels and market dynamics.

“The draw down from this is that the Tinubu administration must have rolled up its sleeves and went to work to redeem the nation’s problematic crude oil production activities as soon as it was sworn into office.”

The group said it is against the backdrop of the  performance of the oil sector as well as the non-oil that it envisaged further economic growth.

“By our conservative estimation, we can posit that the economy may have survived the most elementally critical stage as it adjusts to the  subsidy removal policy and unification of the foreign exchange rates. We, therefore, envisage an economic growth trajectory, even in the face of prevailing challenges confronting the economy.

“We are confident of increased GDP growth in 2024, buoyed by the non-oil sector and driven by expansion in the financial sector which shall benefit from regulatory increase in interest rates as the Central Bank of Nigeria battles to tame inflation and stabilize the foreign exchange rate. These will act together to impact the living standards of the citizens in the months ahead,” it added.