Outlook and risks

The outlook for economic growth remains positive. The economy is projected to grow by 3.5% in 2022 and 4.4% in 2023, depending on political stabilization, security improvements, and persistence of oil production. Inflation is projected to stay elevated at 3.7% in 2022 before falling a little to 2.4% in 2023, driven by international food prices. The fiscal balance is expected to record a surplus of 25.8% of GDP in 2022 and 17.3% in 2023 due to higher revenues from oil output. The current account surplus is projected to climb to 27.9% of GDP in 2022 on increased oil exports, before edging down to 19.1% in 2023. Downside risks include political instability, an oil blockade, social instability (more than 1.3 million need humanitarian aid), and the spread of a new COVID- 19 variant. The authorities should mobilize domestic resources to support economic diversification and a clear reconstruction strategy in public infrastructure.