Nigeria is out of recession!!!
Official report of the Second quarter 2017 GDP from the National Bureau of Statistics (NBS) show the Nigerian economy grew by 0.55%. The real GDP growth of 0.55% in the second quarter of 2017 is the first in about 5 quarters confirming that Nigeria is now firmly out of recession. Revised 2017 Q1 estimates show the economy contracted by 0.91%.
Nigeria’s economy went into recession for the first time in almost 20 years in August 2016 when it contracted by 1.49% in the second quarter of 2016. Quarter on quarter real GDP Growth was 3.23%
The GDp Growth was largely driven by the improvement in the oil sector. Quarter on quarter, the oil sector grew by 7.52% in the second quarter of 2017. The sector also contributed 8.89% of total real GDP in Q2 2017, compared to the first quarter of 2017 where it contributed 8.79%.
What the recovery means
The exit from recession means economic activities are on the rise again. Capital market activities which are usually an indication of a recovery had shown an uptick with the stock market appreciating by over 30% year to date. Q2 capital importation reports also show a massive increase in capital imported into the country. Companies that hitherto put their expansion plans on hold, can no carry on with them.
Concerns still remain
Despite the exit from recession, several analysts have expressed concerns that the recovery may be a weak one. Central Bank of Nigeria (CBN) Governor Godwin Emefiele on the sidelines of the last Monetary Policy Committee (MPC) meeting was of the opinion that the country’s recovery would be short lived except the government put necessary reforms in place.
Fitch, had recently gave the country’s economy a negative outlook due to The recovery from recession was largely driven by a rebound in crude oil prices and production volumes.
Here is a copy of the report.