Nigeria - 2010 - Article IV Consultation-Staff Report; Debt Sustainability Analysis; Informational Annex; Public Information Notice on the Executive Board Discussion; And Statement by the Executive Director for Nigeria (Electronic book text)

1. The Nigerian economy has weathered both the global economic recession and its own domestic banking crisis reasonably well. The economy expanded more rapidly than expected in 2009 and continued to gain strength in 2010.1 The amnesty extended to rebels in the oil producing region led to a sharp recovery in oil production while non-oil GDP growth has remained high. Real GDP grew by 7.5 percent in the first half of 2010 (H1/H1) and is projected to have risen to 8 percent for the year as a whole. Growth in the non-oil sector has been moderating since 2007, but remained robust at 8.3 percent in the first half of 2010, with many sectors growing at double digit rates (Figure 1 and Table 1). Strong growth and targeted public expenditures have helped Nigeria make some progress towards achieving the Millennium Development Goals (Table 6). Nonetheless, policy slippages emerged during the last year: commitment to the oil revenue rule weakened, leading to a pro-cyclical fiscal stance; inflation remained high (Figure 1); and foreign reserves fell even as oil prices have rebounded (Table 2).