Battered by recession, Nigerians were buoyed recently by the optimistic appraisal that the economy will soon emerge from the woods. Governor of the Central Bank of Nigeria, Godwin Emefiele, expects the country to recover by the third quarter of this year, a more cautious prediction than the second quarter timeline given earlier by World Economics, a London-based research agency. For the Muhammadu Buhari adminstration, this is a fresh opportunity to re-tune the economy for sustainable growth beckons.
Nigeria moved into recession by the second quarter of 2016. Triggered by the crash in the prices of crude oil and gas in the international market, the structural weakness of the economy headlined by over-dependence on oil sales receipts, the squandering of fiscal buffers and unrestrained corruption, the recession has hit Nigeria hard. According to the Manufacturers Association of Nigeria, 272 firms were shuttered in 2016, while average industrial capacity utilisation crashed further to 20 per cent. Frank Jacobs, its president, put manufacturers’ losses arising from the adversity and the accompanying foreign exchange crisis at N500bn. Unemployment rose to a record high by the end of 2016, with 13.9 per cent of the working age population jobless and almost 20 per cent underemployed. Youth unemployment was 42.24 per cent by mid-2016, says the National Bureau of Statistics.
But, as negative growth slowed since the first quarter of this year, some pundits predict the economy to grow beyond the 1.9 per cent set by the International Monetary Fund by year’s end. The modest recovery has been helped by oil prices that once fell to $28 per barrel, down from the average $93-$114pb in the first half of 2014, before the crash that set in from August of that year.
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