Nigeria’s economy is growing again after contracting in 2016 on the back of low oil prices, foreign exchange shortages and security issues. Recovery in the oil and agricultural sectors has helped pull the economy out of recession. In addition, measures to rein in elevated budget deficits, alongside higher oil prices, have helped reduce external imbalances and support investor confidence. But medium-term growth prospects remain constrained by inadequate infrastructure and reliance on oil. The IMF expects real GDP growth of around 2.5% per annum on average over the next five years.
Nigeria’s per capita income has risen on average 5.3% per annum over the past 20 years, driven predominantly by elevated commodity prices over much of that time. But lower commodity prices since 2014 and recession in 2016 have weighed on household incomes. Muted growth will see a slow recovery to per capita incomes. The IMF expects GDP per capita should return to its 2014 highs in 2024.