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The International Monetary Fund (IMF), using the more reliable and now widely accepted yardstick said that Nigeria maintained its lead as the biggest economy in Africa in 2020. However, the latest IMF data ranks Nigeria as the 26th largest economy globally, with an average GDP of $442.976 billion.
The computation method used by the IMF, according to the report, is based on nominal GDP, which does not take into account differences in the cost of living in different countries.
The report also mentioned that Nigeria’s economic outlook was challenging and the country’s economy “is buffeted” from side to side by a cocktail of issues, including the uncertainty over the COVID-19 pandemic, low oil prices, capital outflows and balance of payment challenges.”
The report additionally stated that: “The COVID-19 global pandemic is exacting a heavy toll on the Nigerian economy, which was already experiencing falling per capita income and double-digit inflation, with limited buffers and structural bottlenecks.
“Low oil prices and sharp capital outflows have significantly increased balance of payments (BOP) pressures and, together with the pandemic-related lockdown, have led to a large output contraction and increased unemployment.”
Nigeria’s GDP is projected to contract by 3¼ per cent in 2020 due to a number of factors – including the ongoing COVID-19 pandemic – but the recovery is projected to start in 2021, with subdued growth of 1½ per cent and output recovering to its pre-pandemic level only in 2022.