PwC forecasts 7 trends to shape Nigeria economic terrain 2024

PricewaterhouseCoopers has outlined seven trends that will shape Nigeria’s economic terrain in the year.

The company made the outline in its Nigeria-Economic-Outlook-Report on Thursday in Lagos.

It said the trends to look out for in the year included executing fiscal reforms, which is balancing ambition with budgetary implementation.

Others, it said, include evolving monetary policy stance, noting that ‘this is finding the right framework and instruments to
achieve price stability’.

PwC added that in 2024, there would be improved sectoral development riding on reforms and that consumers might likely adjust better to the evolving policy and macro realities.

It also said that the year would have persisting vulnerability to external pressures with potential of ‘shocks’ and undulating pathways to unlocking productivity in the economy, while investors would be cautiously optimistic.

The company, noted that the country’s debt stock might remain elevated in 2024 as government sought to fund deficit via additional borrowings.

It further said that debt sustainability would be a key pressure point in 2024.

“In 2024, in spite of the instruments deployed by the Central Bank of Nigeria (CBN), inflationary pressure may remain elevated in the short term.

“To succeed, the Central Bank of Nigeria (CBN) must independently pursue inflation goals, emphasising inflation control, and maintaining a stable financial system.

“Uncertainty in foreign exchange environment may continue in 2024 if supply challenges persist,” it said.

It added that investors’confidence in Nigeria hinges on the credibility of governance and steady policy execution.

According to the company, institutional efficiency and transparent policy communications are essential for assessment and market predictability, all of which collectively influence investment decisions.

“The interplay between governance, policy implementation, institutional behavior, and communication will partly shape the overall assessment for investors in 2024,” it further said.

PwC said the country’s Gross Domestic Product (GDP) could grow marginally by 3.1 per cent on the back of sustained policy reforms, while growth prospect might be limited by elevated economic pressures growth outlook.

It stated that inflation was expected to decline marginally, balancing the effects of reforms, policy actions, external pressures and food prices.

“Consumer spending recovery may begin in the second half of the year as inflationary pressures ease.

“Expected improved stability in the foreign exchange market in the second part of the year may reduce the imported cost of raw materials and finished goods.

“The marginal decline in inflationary growth may lead to a slight reduction in Selling, General, and Administrative (SG&A) expenses in the medium term.

“Continued tightening of monetary policy rate may keep borrowing costs elevated in the short term,” it also stated.

The company restated its resolve to helping clients and its network understand macroeconomic, mega trends, and Environment, Sustainability and Governance (ESG) development that shape local and global landscape.