World Bank IMF and Dev Agencies | |
World Bank IMF and Dev Agencies | |
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Monday, January 11, 2021 / 11:18 AM /
By CSL Research / Header Image Credit: World Bank Group
Recently, the World Bank published its January 2021 global economic
prospects. The bank expects global growth to expand by 4% in 2021 from an
estimated 4.3% contraction in 2020. In the report, the World Bank expressed
concerns about the recovery phase of many economies, especially the emerging
and developing economies except policy makers can put in place robust and
comprehensive policy framework to improve the existing frail business and
economic environment caused by the unprecedented coronavirus pandemic. The
bank's growth projection for advanced economies (AEs) and emerging &
developing economies (EMDEs) including China was 3.3% and 5.0% in 2021
respectively. Sub-Saharan Africa (SSA) is expected to grow by 2.7%, while the
expected growth for Nigeria is set at 1.1% in 2021.
The World Bank appears less optimistic about the growth prospects across
the globe including Nigeria as many countries are enfeebled as a result of the
ripple effect of the pandemic causing elevated debt levels, rising unemployment
and with the new strain of Covid-19 in many countries resulting in renewed
lockdowns and restrictions, growth estimates may not be met. The bank stresses
that quicker vaccination process across the world would aid faster economic
growth which could step up to 5%, while a possible delay in rollout of vaccines
amid rising infections could hamper growth expansion to 1.6% in 2021. The
prospect of quick vaccination appears a little bleak to us at this time. To
give perspective, according to the Center for Disease Control (CDC) a few days
ago, only 6.7million Americans had received at least the first dose of the
vaccine and that is roughly 2% of America's population in 2 months.
The bank extended its weakened optimism to Nigeria as the country faces
severe pressures from dwindling oil revenues, weak private investments, eroding
consumer spending power and declining foreign investor participation. In our
opinion, restoring the economy to the path of sustainable growth requires
government's conscious efforts in addressing structural challenges impeding
growth in the economy.
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