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The world economy has continued to “enjoy positive momentum” backed by the ongoing expansion in the manufacturing sector, the Organisation of the Petroleum Exporting Countries (OPEC) has said.

Consequently, the organisation in its Oil Market Report, January 2011, said although dependent on government-led support, world economy growth in 2011 has now been revised up to 3.9 per cent from the previous projection of 3.8 per cent.

“World economic activities were stronger than expected, resulting in more oil usage,” it said.

Growth for 2010 was also revised up to 4.5 per cent from 4.3 per cent. The report said the United States economy, which grew by 2.8 per cent in 2010, is now forecast to grow at 2.6 per cent in 2011.

“The deceleration in Japan’s economy remains more pronounced, dropping to 1.5 per cent in 2011 after growth of 4.3 per cent in 2010. The Euro-zone, which is forecast at 1.5 per cent in 2010 and 1.2 per cent in 2011, is expected to continue its two-speed growth pattern, with Germany taking the lead. China and India still face signs of overheating and continue to be challenged by high inflation. The forecasts for China and India remain unchanged at 8.8 per cent and 8.0 per cent for 2011, respectively,” it said.

Meanwhile, Nigeria’s government is targeting economic growth of 10 per cent in 2011. Sanusi Lamido Sanusi, the Central Bank governor, said that financial market conditions in advanced economies have been “more stable” than in the preceding two years, while some emerging economies are been confronted with “challenges posed by large volatile capital inflows.”

Major driver

However, Mr. Sanusi, at the Monetary Policy Committee, on Tuesday, said the provisional data from the National Bureau of Statistics indicated that the nation’s real Gross Domestic Product (GDP) grew by 8.29 per cent in the fourth quarter of 2010, up from 7.86 per cent recorded in the third quarter. He said the overall GDP growth for 2010 was estimated to be 7.85 per cent, compared to the revised growth rate of 6.96 per cent recorded in 2009.

While manufacturing sectors around the globe have continued to boost economic performances, Mr. Sanusi said the non-oil sector remains the major driver of overall growth in Nigeria, “with agriculture, wholesale and retail trade, and services contributing 2.39, 2.04 and 2.08 per cent, respectively.”

“The outlook for 2011 is projected to be generally favourable in view of the continued improvement in the international oil market and emphasis on the development of the non-oil sector,” Mr. Sanusi further said.

Analysts at Financial Derivatives Company Limited, a business consultancy firm, said, “A likely driver of higher inflation (in the economy) is the election spending which will intensify as the impact of the spending hits the market place. Another factor that is expected to contribute to higher prices in 2011 is the expected 64 per cent increase in the minimum wage.”