Dipo Olowookere
By Dipo Olowookere
The journey of Nigeria’s exit from recession seems to have started following the marginal rise in the country’s Gross Domestic Product (GDP) in the fourth quarter of 2020.
In the second quarter of the year, Nigeria, which prides itself as the largest economy in Africa, suffered a 6.10 per cent slip in GDP and this was mainly caused by the lockdown in the period.
The federal government, as part of efforts to curb the spread of COVID-19, imposed lockdown in Lagos, Ogun and Abuja, the key economic hubs of the nation, on March 30.
This was eased in June and economic activities started to pick up in September/October and data from the National Bureau of Statistics (NBS) indicated that in the third quarter of the year, the economy declined by 3.62 per cent and this officially pushed Nigeria into the second recession in fours. The first was in 2016 after declines in the GDP in the year’s first and second quarters. Nigeria exited a year.
When Nigeria entered another recession last year, the federal government assured that it would be shortlived and this was corroborated by the Central Bank of Nigeria (CBN).
The major reason given was that several interventions had been put in place to put life into the economy and get it back on its feet as quickly as possible.
On Thursday, the NBS released the GDP numbers for the fourth quarter of 2020 as well as for the full year.
The data showed that Nigeria’s economy grew by 0.11 per cent in Q4 but contracted for the full year by 1.92 per cent.
“Nigeria’s GDP grew by 0.11 per cent (year-on-year) in real terms in the fourth quarter of 2020, representing the first positive quarterly growth in the last three quarters,” the agency said in the report.
Continuing, it noted that, “Though weak, the positive growth reflects the gradual return of economic activities following the easing of restricted movements and limited local and international commercial activities in the preceding quarters.
“As a result, while the Q4 2020 growth rate was lower than the growth rate recorded the previous year by –2.44 per cent, it was higher by 3.74 per cent compared to Q3 2020.
“On a quarter on quarter basis, real GDP growth was 9.68 per cent indicating a second positive consecutive quarter on quarter real growth rate in 2020 after two negative quarters.
“Overall, in 2020, the annual growth of real GDP was estimated at –1.92 per cent, a decline of –4.20 per cent points when compared to the 2.27 per cent recorded in 2019.”
The stats office noted that last year, the oil sector grew at –8.89 per cent compared to 4.59 per cent in 2019 and contributed 5.87 per cent to total real GDP in Q4 2020, down from the corresponding period of 2019 and the preceding quarter, where it contributed 7.32 per cent and 8.73 per cent respectively.
It was revealed that the non-oil sector grew by 1.69 per cent in Q4 2020, slower than the 2.26 per cent in the same period of 2019, contributing 94.13 per cent to the nation’s GDP in Q4 2020, higher than the 92.68 per cent in the same period of 2019. It also contributed 91.84 per cent to real GDP in FY 2020, higher than 91.22 per cent in FY 2019.
