Nigeria’s Trade Sector fell into a double-dip recession according to data from the National Bureau of Statistics. A double-dip recession typically occurs when gross domestic product growth falls back to negative after a quarter or two of positive growth rate.
Nigeria’s trade sector which makes up about 16.45% of Nigeria’s Gross Domestic Product composition fell to -2.14% in the second quarter of 2018. This was the second consecutive quarter of negative GDP growth rate after it fell -2.57% in the first quarter of 2018.
Why this matters?
- This is second consecutive negative Trade GDP growth rate throwing the sector into a double dip recession.
- A double-dip recession occurs when a country or sector returns to a recession after a short period of GDP growth rate.
- Trade sector posted a growth in the last quarter of 2017 however it has posted negative GDP growth rate in the first three quarters of 2017 and the first two of 2018.
- With the trade sector in the throes of a recession, Nigeria’s GDP growth rate will continue to remain paltry.
- Nigerians are largely traders and with government policy stifling importation most traders lack the forex required to import goods for sale into the country.
- Total imports into the country was about N2.5 trillion in the first quarter of 2018 higher than the N2.1 trillion reported in the last quarter of 2017.