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Nigeria’s “Economic Temperature” Is Getting Warmer, Hinting A Growth – World Bank

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Nigeria’s “Economic Temperature” Is Getting Warmer, Hinting A Growth – World Bank

The international body known for providing financial assistance, advice, products, and solutions for economic advancement of countries, World Bank commended Nigeria’s economic situation, said its “economic temperature is getting warmer and hinting growth.”

According to World Bank on Nigeria Development Update: Resilience Through Reforms , dated June 15, 2021

“The NET Index is produced by the World Bank and measures the “temperature” of the Nigerian economy based on a set of 14 high-frequency indicators including headline
inflation, oil prices, manufacturing PMI, Treasury Bill rates, currency in circulation, exchange rate indicators (e.g., premium between the parallel vs. NAFEX rates), external
reserves, and credit to the private sector. The color coding is based on the deviations of each indicator relative to a 5-year average. RED indicates potential stronger growth
(the economy is heating up). BLUE indicates the opposite (the economy is cooling).”

World Bank also commended Nigeria for undertaking major economic reforms to mitigate the impact of the pandemic ( COVID-19).

It noted some reforms like, Transparency of oil revenues: citing  NNPC’s first-ever publication of
audited financial statements, and said that “the public now has much more available
information to assess NNPC’s operations.”

Budgeting practices and accountability of COVID-19 spending: It stated that the “Federal Government of Nigeria (FGN) and the 36 states responded in a coordinated manner by adopting crisis-responsive budgets.”

Debt Transparency: World Bank also noted that there is “more timely information available online, and the government is compiling a comprehensive catalogue of contingent liabilities.”

It also added that “Debt Transparency is critical to reduce the cost of borrowing.”

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