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Nigeria officially out of recession but it’s ‘still too soon to cheer’
Figures from the National Bureau of Statistics (NBS) show that Nigeria’s Gross Domestic Product (GDP) for the second quarter of 2016 grew by 0.55 percent.
This development, according to Yemi Kale, the Statistician-General of the Federation, is the fifth consecutive positive growth since the first quarter of 2016, signifying that Nigeria is technically out of recession.
According to Kale, the GDP grew from -0.91 percent in the first quarter of 2017, to 0.55 percent in the second quarter. This is against the -1.49 percent GDP recorded in the same quarter of 2016.
NBS publishes Q2 2017 GDP. Nigeria out of recession: GDP grows 0.55% in Q2 2017 compared to -0.91% (revised)in Q1 2017 & -1.49% in Q2 2016 pic.twitter.com/OLr8ra4Akc
— Dr Yemi Kale (@sgyemikale) September 5, 2017
There was visible growth in almost all the sectors of the economy, including manufacturing mining, agriculture and oil and gas.
But analysts say that although the figures show a growth in the economy, it is too early to cheer, as it will take some time before citizens start noticing the change in terms of money in their pockets.
Speaking during a Channels Television programme, Bismack Rewane, an economic expert, said there must be significant growth in certain key sectors, especially production and employment, before Nigeria can pat itself on the back.
Rewane noted that the 0.55 percent growth in the GDP is still about 2.3 percent lower than the population growth rate of the country.
“In other words, Nigerian women give birth to 14,000 babies every day. The output here… will only feed technically about two or three thousand babies,” he said.
“So we have to increase our production to over 2.8 percent to be equal to the amount of new mouths that are coming in every day.
“Also we need to grow at above 5 percent to absorb the unemployed. So there are two issues here; one is, how much production do you need to increase to take care of the new mouths; and two, how much activity do you need to be able to absorb the unemployed so that we can have some social stability?
“That’s why we say [the out-of-recession story] is good news but it’s too soon to cheer. There are a lot of work to be done.”
However, Yemi Kale, who also appeared on the same programme, pointed out that there are three phases of economic recovery especially as in the current Nigerian context.
He said: “You have to first get out of recession with quality growth, and that’s anything from .00001 to whatever percent positive. Then from there you start to recover.
“My definition of recovery is going back to where you were before the slump, which is basically where we were in 2014 where we started the slow down.
“Then you start to grow and that means become more sustainable, taking it to more sustainable levels.
“So I think even though this is very good news — at least we are not contracting — this is just the first stage. The second stage is getting us to where we were before the contraction started and then from there we go further.”