Nigeria expects to lower its forecast
for 2015 economic growth again, after cutting its forecast to 5.54
percent in January, after oil prices fell and the currency weakened
further last month, the country’s statistics bureau said.
Yemi Kale told the Reuters Africa Investment Summit on Tuesday
he did not expect a reduction of more than 1 percent in the 5.54
percent forecast. Final figures will be released by half-year, he said.
Nigeria lowered its forecast for
economic growth in January from 2014’s 6.22 percent after the government
cut spending because the price of oil had slumped.
“Because of the changes in the
macro-variables … we are not sticking with those forecasts any longer.
The exchange rate, crude oil forecast have changed,” Kale, the head of
the National Bureau of Statistics (NBS), told Reuters by telephone.
“I’m assuming the growth rate may drop
further,” to around 4 percent,” Kale said, “but again other sectors may
compensate for the drop in oil prices and the depreciation.”
Nigeria’s currency suffered its biggest
monthly decline in more than five years last month, amid concern over
political uncertainty and the central bank’s ability to manage the
currency as oil prices fell.
The naira fell through a psychologically
important level of 200 to the dollar in February, prompting the central
bank to scrap its bi-weekly forex auctions, in a de facto devaluation.
Kale expects inflation in Africa’s
biggest economy to inch up to around 9 percent, the upper end of the
central bank’s target, from its January forecast of 8.78 for 2015.
More than half of Nigeria’s population
of 160 million live in villages and imports account for only 13 percent
of total domestic consumption, Kale said, so the effect of imported
inflation has been limited following the devaluation.
Reforms to the non-oil sector and
investments in power and infrastructure should help cushion the loss of
revenues from weak oil prices, he said, saying “the price of commodity
(oil) has gone down, but the exchange rate weakness has cancelled the
impact on the inflation.”
Kale said data on imported capital for
the past two years showed a significant amount of foreign capital flowed
into the country. But it flowed out as oil prices started to plunge
last year, exerting pressure on the currency.
The stock exchange said last month
foreign investors sold shares valued at N846.5 billion ($4.5bn) in 2014,
as oil dropped and the currency weakened.
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