Nigeria’s Gross Domestic Product (GDP) shrunk by 2.24 per cent in the third quarter of 2016, worsening the country’s chances of getting out of its current recession in 2016.
According to the National Bureau of Statistics (NBS), the country’s GDP fell deeper than recorded in the first and second quarters of 2016, leading to the economy shrinking by 0.36 per cent in the first quarter, and 2.06 per cent in the second quarter of 2016.
But experts say that for the country to get out of recession in 2016, it must record a GDP growth of at least 4.32 per cent in the last quarter of 2016.
Meanwhile, the oil sector contributed 8.19 per cent of total real GDP, down from figures recorded in the corresponding period of 2015 and the preceding quarter of 2016 at 10.27 per cent and 8.26 per cent respectively, NBS said.
On the other hand, the non-oil sector grew by 0.03 per cent in real terms in the third quarter of 2016, reversing the last two quarters of negative growth recorded in Q1 and Q2 2016.
The sectors of the economy, which recorded growth include crop production, fishing, metal ores, textile and footwear, human health and social services, public administration, technical services, financial institution, arts, entertainment and recreation.
Those that recorded decline were livestock, forestry, oil and gas, coal mining, quarry and other minerals, real estate, food and beverage, motor vehicle and assembly, iron and steel, electronic, chemical and pharmaceuticals, wood and wood products, cement, education, insurance and telecommunication.
Air transport also recorded a decline, while every other means of transportation in the country recorded an increase.
According to the report, “real agricultural GDP growth in the third quarter of 2016 stood at 4.54 per cent (year-on-year), an increase of 1.07 per cent points from the corresponding period of 2015.
“Growth basically remained the same when compared with the previous quarter, which was recorded as 4.53 per cent. The contribution of agriculture to overall GDP in real terms was 28.65 per cent in the quarter under review, higher by 1.86 per cent from its share in the corresponding quarter of 2015, also higher from the second quarter of this year by 6.10 per cent.”
The Federal Government had initially projected a three per cent growth rate for the country in 2016, while the International Monetary Fund (IMF) projected a 1.8 per cent decline.
Meanwhile, the Federal Government yesterday, said that despite the economic recession reflected in the latest release by the National Bureau of Statistics (NBS), its policies have been evidently effective and responsive to pulling the country out of the woods.
Reacting to the latest NBS release, the Special Adviser to the President on Economic Matters, Dr. Adeyemi Dipeolu, explained that the report revealed a consistent growth in agriculture and solid mineral sectors, indicating the success of the Buhari administration’s economic policies even though overall economy is still in recession.
According to him, the third quarter results just released by the NBS show that the Nigerian economy is still in recession as growth in Gross Domestic Product (GDP) fell by -2.24 per cent in the third quarter as compared to the decline of -2.07 per cent experienced in the second quarter of the year.
He further noted that the slight deterioration in national economic performance owes largely to the continued poor performance of the oil and gas sector, which worsened to -22.01 per cent in the third quarter as compared to -17.48 per cent in the second quarter of 2016.
The Special Adviser said, “the Strategic Implementation Plan (SIP) for the implementation of the 2016 Budget of Change prioritised capital expenditures for power, roads and rail as well as social investments.
“In addition to creating jobs and promoting social inclusion, these expenditures will also provide a stimulus by putting money in the hands of people.
“The usual economic activity that takes place in the Yuletide season will also likely have a positive impact on the wholesale and retail trade sector.
“Overall, therefore, it is expected that these factors which will be underpinned by the policies to be unveiled in the Economic Recovery and Growth Plan (ERGP), to be adopted before the end of the year, will lend further momentum to ongoing efforts to revitalise and reposition the economy,” he said.