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Nigeria To Emerge 14th Largest Economy By 2050 – PWC

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by Bukola Idowu, Lagos
Nigeria has been projected to emerge the 14th largest economy in the world by the year 2050 but it needs to aggressively boost domestic and foreign investments over the next decade to deliver sustainable growth with per capita gains.

According to PWC the recent string of economic releases suggest that the economy might have bottomed out, with fragile signs of recovery, driven largely by improved liquidity in the foreign exchange markets and policy measures to improve the business environment.

Nigeria’s GDP growth had improved to -0.57 per cent in the first quarter of 2017 from -1.73 per cent while inflation has been on a steady decline having dropped to 16.10 per cent in June. Also, the value of the naira which had reached an all-time low earlier in the year had firmed to N365 to the dollar on increased liquidity.

PWC in a report noted that the fiscal narrative of the country remained unchanged as lower for longer oil price means that traditional sources of financing for Nigeria’s budgetary needs will remain stretched.

“Nigeria is projected to be the third largest populated country in the world by 2050 with 399 million people. PwC projects that Nigeria could emerge the 14th largest economy in the world by 2050, with GDP in Market Exchange Rate (MER) terms at $3.3 trillion.

“In 2016, Nigeria’s economy slowed markedly, falling into a recession for the first time since 1991. Real GDP contracted 1.5 per cent year on year, a reflection of the two and a half year decline in export earnings, and fall in government revenues which impacted consumer spending and investments.

Perhaps the most evident impact of the sharp decline in the oil price was in the currency market, with the naira/dollar rate depreciating 35.4 per cent in the official market and 47.3 per cent in the parallel market during the year.

“Asides the depreciation in the currency, the illiquidity in the foreign exchange market impacted the business and investment environment, with Foreign Direct Investment (FDI) declining to a 11-year low, and a collapse in investment as a share of GDP to 12.6 per cent – the lowest level in the past two decade

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