The International Monetary Fund has said oil-dependent economies, including Nigeria, continue to fare less than countries reliant on other export sectors, a pattern in place since the drop of oil prices in 2014.
The IMF stated this on Thursday in its policy paper on macroeconomic developments and prospects in low-income developing countries.
It said the paper was discussed by its executive directors on November 13, 2019.
The LIDCs are a group of 59 IMF member countries primarily defined by income per capita level below a certain threshold (set at $2,700 in 2016).
It noted that experiences varied markedly within the group, with countries in fragile situations typically recording weaker-than-average performance.
Nigeria’s economy grew by 2.28 per cent in real terms in the third quarter of this year, compared to 2.12 per cent in Q2 and 2.10 per cent in Q1, according to the National Bureau of Statistics.
According to the IMF, the rapid growth in public debt recorded between 2013 and 2017 slowed significantly in 2018-19, although the general trend was still an upward drift in debt burden.
The fund said, “Debt levels in several countries (notably fuel exporters) fell sharply on fiscal tightening and recoveries of GDP and/or real exchange rates (which boosted dollar-equivalent denominators). An important exception is Nigeria, where debt to GDP ratio continued to increase.
“The number of countries facing serious debt challenges, as assessed by bank-fund debt sustainability assessments, has risen only marginally since 2017, after increasing sharply in the preceding four years.”
The IMF directors noted that public debt vulnerability remained a serious cause of concern in many LIDCs, with more than two-fifths of countries assessed to be at high risk of, or already in, debt distress.
They emphasised the importance of strengthening debt management capacity and improving data quality and transparency, to be supported by implementation of the joint bank-fund multi-pronged approach to tackle debt vulnerability.
It said current account balances weakened in many countries during 2018-2019, although with different drivers.