GDP contracts again but Nigeria inches closer out of recession

The Nigerian economy remains in its worst recession in 29 years!

The National Bureau Statistics confirmed this on Tuesday, as it released the gross domestic product (GDP) report for the first quarter of 2017, which showed that the economy contracted by 0.52 percent year-on-year.

NBS adds that this particular contraction of 0.52 percent is the best performance in four quarters, compared to revised 1.73 percent contraction in Q4 of 2016  and 0.67 percent in Q1 2016.

Still in negative territory, the oil sector saw a boost in its fortune as it contributes 8.9 percent of the country’s GDP, as against the 6.75 percent in the fourth quarter of 2016.

The non-oil GDP grew by 0.72 percent to record the best performance in four quarters, when compared to -0.33 percent in Q4 2016 and -0.18 percent in Q1 2016.

Despite this performance, the contribution of the non-oil sector to GDP declined by nearly two percent from 93.25 percent in Q4 2016 to 91.10 percent.

Transport services GDP contracted by 4.01 percent in Q1 2017 from -2.63 percent in Q4 2016 and 2.23 percent in Q1 2016.

According to Yemi Kale, the statistician general of the nation, many sectors of the economy turned positive but failed to get the country out of recession.

In August 2016, NBS called Nigeria’s first recession since the return of democracy in 1999, stating that the economy shrank by 2.06 percent in the second quarter of 2016 to hit its lowest point in nearly three decades.

According to World Bank data, the last time Nigeria had this magnitude of economic decline was under the military regime of Ibrahim Babangida, when the economy recorded consecutive decline of 0.51 percent and 0.82 percent in first and second quarters of 1987.

The World Bank, IMF, CBN, ministry of finance and Nigerian presidency have all said at one time or the other that the Nigerian economy will get out of recession in 2017.