Nigeria’s economy contracted marginally in the first quarter of 2017 data from the National Bureau of Statistic has shown. This is the fifth quarter the economy has contracted though this time its has slowed showing signs of improvement.
The CBN has said that by September, the third quarter of 2017, the economy will be out of recession. The Presidency has also said that the road to economic recovery will slow.
Gross Domestic Product GDP, this time shrank by 0.5 per cent in the first quarter from a year earlier, compared with a revised 1.7 percent contraction in the final three months of 2016, the National Bureau of Statistics said.
NBS in its report said “In the first quarter of 2017, the nation’s Gross Domestic Product (GDP) contracted by –0.52 per cent year-on-year, in real terms, representing the fifth consecutive quarter of contraction since first quarter of 2016. This is 0.15 per cent higher than the rate recorded in the corresponding quarter of 2016, revised to –0.67% from –0.36%, higher by 1.21 per cent points from rate recorded in the preceding quarter, revised to –1.73% from –1.30%. Quarter on quarter, real GDP growth was –12.92 per cent
“During the quarter, aggregate GDP stood at N26,028,356.03 million in nominal terms, compared to N22,235,315.29 million in first quarter of 2016, resulting in a Nominal GDP growth of 17.06 per cent. This growth was higher relative to growth recorded in first quarter of 2016, 11.39 per cent.”
The Nigerian economy took a hit after oil prices crashed in mid-2014 and militants from Niger Delta destroyed pipelines, causing production to fall to an almost three-decade low. That and power shortages weighed on output, with GDP shrinking a revised 1.7 percent least year, the first full-year contraction in a quarter of a century.
Foreign-currency shortages fueled by falling oil exports caused inflation to accelerate every month for more than a year until January.
“Agriculture slowed year on year, and that is bad news because it was the dependable sector for growth,” John Ashbourne, an economist at London-based Capital Economics, said by phone.
The oil industry contracted 11.6 percent from a year earlier, a sixth straight quarter of declines, while agriculture, which contributed 24 percent of GDP, expanded 3.4 percent, the slowest pace since the first three months of last year, the statistics office said.
The International Monetary Fund forecasts the economy will grow by 0.8 per cent this year and the World Bank predicts expansion of 1.2 per cent. The government said recovery will be driven by a rebound in output of oil, which accounts for two-thirds of its revenue, as well as increased state spending.
