The KPMG report on Nigeria’s political transition and naira redesign predicts that the country’s Gross Domestic Product will grow at a relatively slow pace of 3 percent in 2023. This modest expansion reflects challenges associated with the currency redesign and the broader political transition. In its newly released *2023 Global Economic Outlook*, the multinational consulting firm warns that a slowdown in the global economy, together with its trade and financial‑flow implications, is likely to drag on Nigeria’s GDP. The economy had recorded eight consecutive quarters of growth after emerging from the pandemic‑induced recession in 2020, ending the previous year with a 3.52 percent growth rate in Q4 2022, up from 2.25 percent in Q3 2022, and an average growth of 3.10 percent for 2022.
The report highlights that key non‑oil sectors—manufacturing, trade, accommodation and food services—will be negatively affected by the naira redesign policy introduced by the Central Bank of Nigeria (CBN) in the last quarter of 2022. In October 2022, CBN Governor Godwin Emefiele announced plans to redesign the old N200, N500 and N1,000 notes, a move that sparked widespread condemnation from economists, politicians and other stakeholders. KPMG notes that the redesign, implemented in Q4 2022 and Q1 2023, will spill over into these sectors, further slowing overall GDP growth.
The outlook for the incoming administration of President‑elect Bola Tinubu is also cautious. The new government, set to take office in May 2023, will inherit a fragile economic environment marked by slow growth and foreign‑exchange challenges. Government revenue is expected to remain inadequate to fund essential expenditures, leading to a high debt stock and substantial debt‑service payments. Additionally, the oil sector contracted by 19.22 percent due to pipeline vandalism, oil theft, low investment and other operational difficulties, reducing production from 2.07 million barrels to 1.0 million barrels.
Commenting on the findings, Regina Mayor, Global Head of Clients & Markets at KPMG International, said, “The phrase that has overwhelmingly dominated conversations—from boardrooms to political chambers and main streets—has been the cost‑of‑living crisis. The impact of such a lengthy period of uncertainty is being felt by everyone, and that’s reflected in KPMG’s latest Global Economic Outlook.”
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