“Telecoms, Financial Services, Others Responsible for Nigeria’s Growth”

The African Export-Import Bank’s Chief Economist, Dr. Hippolyte Fofack, says the telecommunications and financial services sectors, along with investments in strategic industries, are responsible for Nigeria’s economic growth resilience .

The economist said Africa had shown remarkable growth resilience in recent years, rebounding from its first recession in a quarter century, with overall output rising 6.9% in 2021.

He disclosed this in a report titled “Africa’s Growth Prospects for 2022: Balancing Under Post-Pandemic Pressures and Growing Geopolitical Pressures.”

Fofack said: “Despite the prolonged negative effects of conflict and insecurity, particularly in the Sahel region, members of the Economic Community of West African States are also expected to experience robust growth in 2022. .

“The sub-region will be supported by the usual assortment of performing countries (Benin, Côte d’Ivoire, Ghana, Guinea and Senegal), and by Nigeria, where the Purchasing Managers Index (PMI) rose sharply. to 57.3 in February 2022. , the biggest expansion since November 2019.

“The telecommunications and financial services sectors, along with significant investments in strategic industries, are building resilience for growth in Nigeria. The oil sector will also benefit from a gradual easing of OPEC+ production cuts and rising prices, which received further impetus from the Ukraine crisis.

“These should stay above the country’s fiscal equilibrium price of $62 a barrel.”

He said: “Indeed, in addition to supporting the recovery of the Nigerian economy through counter-cyclical credit expansion, these measures are accelerating the diversification of sources of growth and trade.

“Building back better is crucial in a country where vulnerability to commodity price cycles has long hampered its ambitions for macroeconomic stability and long-term growth. Compared to 2019, credit growth exceeded N4tn ($9.6 billion) and targeted critical sectors such as manufacturing, which supported growth in labor-intensive employment opportunities implemented and has acted as a stable vector out of poverty.

“This industry has long been neglected despite its enormous potential for effective integration into the global economy – in which trade has been driven by manufactured goods with increasing technological content – ​​and inclusive growth through the expansion of business opportunities. stable jobs.

“The manufacturing sector received the largest allocation of domestic credit to the private sector last year, a trend that forecasters predict will continue. Policymakers pledge to diversify away from oil and gas, as this reduce excessive vulnerability to boom and bust cycles and support the expansion of fiscal space to strengthen the foundations for medium- to long-term macroeconomic stability.

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