The federal government has blamed the incessant destruction of oil facilities by militants in the Niger Delta as being directly responsible for the persistence recession in the Nigerian economy in the third quarter of 2016.
This was made known by the National Economic Management Team, NEMT, headed by Vice President Yemi Osinbajo, in a statement by the Special Adviser to the President on Economic Matters, Adeyemi Dipeolu.
Also identified as a remote cause of the economic crunch is what the economic team referred to as the continued out-sized influence of the oil and gas sector on the rest of the economy.
The statement, however, sounded optimistic that the Niger Delta crisis would soon come to an end as the government had opened several channels of communication with all relevant groups in the region.
It also expressed optimism that other measures being put in place by the government, including those targeted at the manufacturing sector, would spur the economy “back to overall positive territory.”
The team assured that urgent fiscal and monetary measures were “certainly in the offing” in lieu of the persistence of the recession in the third quarter.
Though the overall economy of the country was still in recession, the statement pointed out that the third quarter GDP figures released by the National Bureau of Statistics revealed a consistent growth in agriculture and solid mineral sectors.
The statement read: “There are however some green shoots of economic recovery beginning to emerge. To start with, ongoing consultations to bring lasting peace to the Niger Delta have enabled an increase in oil and gas production which, if sustained at current prices, will bring a measure of relief to the economy. Other key sectors of the economy showed encouraging signs of improvement.
“Similarly, while inflation is still high at 18.3% on a year-on-year basis it has begun to level out on a month-on-month basis and should enable the deployment of more policy tools to support growth and employment. Indeed, growth of headline inflation slowed down appreciably from 13.8% in May to as low as 1.70% in September.
“The ratio of investment to GDP also showed a notable improvement rising by 7.6% in the third quarter of 2016 as compared to a contraction of -7.4% in the fourth quarter of 2015.