KPMG cuts Nigeria’s 2023 GDP growth forecast to 2.85%

KPMG, a professional services firm, said on Thursday that Nigeria’s economy will grow more slowly in 2023 than previously predicted.

The firm revised down the country’s Gross Domestic Product growth projection for this year to 2.85 percent from 3.0 percent. 

It pointed out in a report that real GDP in Nigeria rose by 2.31 percent year-on-year in the first quarter of 2023, “considerably lower than 3.52 percent recorded in Q4 2022 and 3.11 in Q1 2022 with agriculture contracting for the first time since 1987, industry continuing its contractionary trend and services driving growth.”

“Given developments in the first quarter of the year, our macroeconomic model has adjusted our GDP forecasts for 2023 from 3.0 percent to 2.85 percent,” said Yemi Kale, the country’s former statistician general who is now chief economist at KPMG Nigeria.

“We anticipate growth in Q1 and for the rest of the year will continue to be driven by government consumption expenditure and government investment growth with household consumer demand struggling in the face of high and rising inflation and in the presence of negative real wages and higher unemployment,” he said. “We also expect private investment to remain flat.”