Economic experts and financial analysts have predicted a further depreciation of the naira, as well as a nearly three-percentage-point increase in the country’s Gross Domestic Product in 2022.

On Thursday, they spoke during a webinar hosted by Blue Talks Enterprise Banking.

According to Muyiwa Oni, Regional Head of Equity Research, West Africa, Standard Bank Group, who spoke at the webinar, the financial institution expects the naira’s value to fall as the year proceeds.

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He said:
“We predict that the currency on the official market will be around N440 per dollar from around N416 or N417 that it is. Our view is that as long as we don’t see formal reforms in the foreign exchange market, the shortage we continue to see will persist.”

He noted that, due to unfavourable business conditions, some investors had decided to withdraw their funds from the Nigerian economy.

According to him, inflation will average around 15%, with a 2.9 percent increase in the country’s GDP.

He said:
“Last year, we saw a GDP growth of 3.4 per cent which is still recovering from the contraction in 2020. Even with this, some people argue that the economy is not still operating at the 2019 level yet, and our view for 2022 is that we will see further economic growth which we estimate at 2.9 per cent in GDP.

Our expectation is that the non-oil sectors will continue to drive it. We have seen strong growth in the ICT sector, trade, real estate, construction, and manufacturing as well.”

Oni stated that the expected rise in inflation would cause the country unimaginable hardships such as widespread insecurity, flooding, increased electricity tariffs, currency depreciation, rising energy costs due to geopolitical tensions, and subsidy revocation.

In support of the estimates, Wole Adeniyi, Chief Executive Officer of Stanbic IBTC Bank, stated that businesses in Nigeria may face significant hurdles despite being the key contributors to the country’s economy.

He said:
“Enterprises play a significant role in most economies and Nigeria is no exception. These enterprises are essential contributors to job creation and economic development in Nigeria.

SMEs contribute over 48 per cent in national GDP and account for about 96 percent of businesses, which in turn create about 84 per cent of employment in 36 States across the country.

However, despite the substantial contribution of SMEs to Nigeria’s economy, challenges still abound, such that the growth and development of different sectors face impediments.

These challenges include limited access to capital financing and adequate public infrastructure.”