Analysts optimistic on Nigeria’s economic growth in 2023 amid headwinds

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Top analysts on Monday x-rayed the state of the Nigerian capital market in 2022 and forecast recovery in 2023 despite the headwinds and uncertainties associated with the economy.

The Nigerian economy is going through a tough period with headwinds, including imported inflation, huge debt service-to-revenue ratio, high exchange rates, forex scarcity, devaluation of currency, budget deficit of N12 trillion in 2023, removal of fuel subsidy on petroleum price, insecurity  and uncertainty about the outcome of the upcoming presidential election amongst others.

Speaking separately during the conversation organized by Chartered Institute of Stockbrokers (CIS) on “The Nigerian Economic Review of 2022 and Outlook for 2023”, two prominent stockbrokers, Prof Uche Uwaleke, President of Association of Capital Market Academics and  and Mr. Ayo Ebo. Chairman, Research and Technical of CIS, who spoke on the “Macroeconomic Performance and the Capital Market” and The Nigerian Economic Review of 2022 and Outlook for 2023 respectively assured the investing public that the economy had strong potential to bounce back this year.

They, however, urged whoever emerges the President after this year’s election to address structural issues that militate against the country’s economic development.

“Contrary to projections in several quarters, government’s fiscal position is likely to improve in 2023 on account of the following: improvement in crude oil revenue from increase in crude oil production,  assuming crude oil price does not disappoint and incidence of oil theft continues to go down, savings from fuel subsidy removal will increase government revenue, implementation  of Finance Act 2022  and  unification of exchange rates will boost economic growth and development,” Uwaleke said.

Corroborating him, Ebo stated that expected higher crude oil would increase government revenue in the year.

“Goods account balance is expected to recover in 2022 due to higher crude oil prices. In 2023, the goods account is expected to benefit from reduced forex outflow on petroleum motor spirit ( PMS) importation, following the coming onstream of Dangote’s refinery and promotion of non-oil export. Increase spread of working-class Nigerians in the diaspora is expected to continue supporting the strong performance of the transfers account, especially, the remittance component. Political stability post-2022 and more market-oriented policies of the new administration are expected to drive a steady recovery in portfolio inflows over the medium term. An optimal growth rate for Nigeria is between. 5% and 7 % per annum,” Ebo said

Speaking on “The Chartered Institute of Stockbrokers’ Scorecard”, the President and Chairman of Council, Mr. Oluwole Adeosun also explained that the Nigerian economy would experience growth during the year.

He also listed many achievements of the Institute in the review period and stated that the Institute shall pursue its advocacy roles with renewed vigour

“In 2023, we shall be working to increase the number of Nigerian universities offering both Post-Graduate and Bachelor’s Degree courses in Securities and Investment/Capital Market Studies. We shall be pursuing more vigorously, activities to promote Capital Market Literacy across the entire geo-political zones of Nigeria.

“In  furtherance of our ‘Catch Them Young campaign’, we shall make deliberate efforts to penetrate the university campuses more rigorously and effectively. The CIS Academy will work even harder to bring affordable world class training to our members, in emerging areas like Derivatives, etc,” Adeosun said.

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