Nigeria's economy performing badly, might decline further in 2019

The financial market volatility will likely continue next year, because the US Federal Reserve, after raising the federal funds rate by 25 basis points in its September 26 meeting, nonetheless signaled another rate hike by the end of this year and maintained its projection for three rate hikes in 2019.

At a news briefing on Tuesday, IMF chief economist Maurice Obstfeld outlined the economic challenges that Pakistan was facing now and also commented on its ability to finance itself.

Sustained trade tensions could slash Asia's economic growth by up to 0.9 percentage points in coming years, the International Monetary Fund said, urging policymakers in the region to liberalise markets to offset the fall in export sales.

Global trade tensions would also have a bearing on the eurozone's 2018 growth forecast, which was cut to 2 percent from 2.2 percent previously.

For next year, trade is seen growing just four per cent, a half point less than the prior forecast.

The IMF warned that China's growth even risked declining by a full percentage point by next year in the event of a "worse-case" scenario, involving further tariffs coupled with a collapse in confidence by businesses and markets.

The Fund says the global economy's growth target has dropped by 2 percent from the initial 3.9 percent. "Inclusive fiscal policies, educational investments, and ensuring access to adequate health care can reduce inequality and are key priorities", he added.


And it stressed "cooperative solutions" to help boost continued growth in trade "remain essential to preserve and extend the global expansion".

China's economy could also take a hit: The IMF revised its forecast for economic growth in 2019 down to 6.2 percent, slightly lower than previous estimates and down from 6.6 percent this year.

Several emerging markets had their forecasts cut, including Argentina, Brazil, Iran and Turkey, reflecting factors including tighter credit.

In its suggestions to boost growth, the International Monetary Fund said the United Kingdom should look at easing planning restrictions to boost housing supply, improve the quality of transport infrastructure, and facilitate the relocation of workers in industries that are likely to be more affected by higher trade barriers after Brexit.

US President Donald Trump has accused China of deliberately manipulating its currency to gain a trade advantage, claims Beijing consistently rejected.

United States stimulus also adds to the "already-unsustainable" debt and deficit that will undercut future growth, the report warned.

Milesi Ferretti, Deputy Director Research said while presenting the report that "the continent could do much better once these economies are on the a more solid footings, particularly South Africa and Nigeria because they are really large and affect a number of countries in their neighbourhood".


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