Nigeria’s 2024 Economic Outlook : How can Businesses thrive?

In 2023, the global economy demonstrated resilience in the face of uncertainties, with countries adapting to new realities and pursuing diverse strategies to navigate a dynamically challenging economic environment. Global growth is expected to be mild (2.9%) in 2024, driven by continued geopolitical tensions, weak trade and lower business and consumer confidence. We expect inflation to continue to ease gradually back towards monetary target in most economies causing softening of interest rate tightening by most central banks. Major elections scheduled to hold during the year will increase the odds of the global economy diverging from its current path.

Despite major challenges faced by the Nigerian economy in 2023, it maintained steady but low growth as activities in the non-oil sector remained resilient. We expect the economy to gradually pick up and deliver approximately 3% real growth in 2024. Inflation is expected to remain elevated in the medium term, whilst foreign exchange volatility should remain a major pain point given the FX supply bottlenecks. We also anticipate a closely coordinated mix of fiscal, monetary, trade and FX policies in 2024 to reduce inflation, win the confidence of international investment community and achieve macroeconomic stabilization.

The realities of 2024 will pose both challenges and opportunities for companies around the world. Given that businesses differ fundamentally, leaders would require custom-made action plans to capitalize on the opportunities the events of 2024 would present while also mitigating the risks they pose. To thrive in 2024, Nigerian businesses must device custom-made strategies to deal with five key macroeconomic instability issues: FX volatility, inflation, high interest rate, fiscal stress and relatively unattractive economy.