Nigeria Exits Recession And Looks Beyond Oil

Nigeria’s economy is picking up according to the IMF’s latest economic review.

Growth hit 0.8 percent in 2017 after contracting by 1.6 percent in 2016.

The report attributes the increase—in part—to the recent recovery in oil prices.

But as the country emerges from recession, the IMF’s Amine Mati says following through on planned reforms regardless of oil price swings and upcoming elections, is key to lifting Nigeria’s growth rates to where they should be.

Mati heads the IMF team for Nigeria and oversaw this latest economic assessment.

Listen to what she’s got to say in the audio clip by clicking the link below

Amine Mati On Nigeria’s Exit From Recession.mp3

Nigeria’s Inflation Drops For 13th Consecutive Month

For the 13th consecutive month since January 2017, Consumer Price Index, CPI, dropped to about 15.13 per cent in January 2018, the National Bureau of Statistics, NBS, said in its latest Inflation Report.

The rate was about 15.37 per cent in December 2017, from about 18.72 per cent in January 2017.

CPI measures the composite changes in the price of consumer goods and services purchased by households, such as transportation, food and medical care, over a period.

On a monthly basis, the NBS said CPI in January 2018 dropped by 0.24 per cent points from the rate recorded in December (15.37 per cent).

Increases were recorded in all 12 Classification of Individual Consumption by Purpose, COICOP, functions that yield the Headline Index used in the report.

On a month-on-month basis, the NBS said the Headline index increased by 0.80 per cent in January 2018, or about 0.21 per cent points higher from the rate of 0.59 per cent recorded in December 2017.

The percentage change in the average composite CPI for the 12-month period ending January 2018 over the average of the CPI for the corresponding period was 16.22 per cent, or about 0.28 per cent point lower from 16.50 per cent in December 2017.

The NBS said urban inflation rate rose by 15.56 per cent in January 2018 from 16.78 per cent in December 2017, compared with the rural inflation rate, which declined by 14.76 per cent in January 2018 from 15.02 per cent in December 2017.

On a monthly basis, the urban index rose to 0.83 per cent in January 2018, up by 0.17 from 0.66 per cent recorded in December 2017, while the rural index also rose to 0.77 per cent in January 2018, up by 0.23 points when compared with 0.54 per cent in December 2017.

The corresponding 12-month year-on-year average percentage change for the urban index stood at about 16.55 per cent in January 2018. This is less than 16.92 per cent reported in December 2017, compared with the corresponding rural inflation rate in January 2018 which dropped to about 15.89 percent from about 16.10 per cent recorded in December 2017.

The report said the annual food price index and food price pressure continued into December though generally at a slower pace year-on-year.

The Food Index stood at about 18.92 per cent (year-on-year) in January 2017, down from the rate recorded in December (19.42 percent).

The implication is that Nigerian consumers were paying less for food during the month than they did in the previous month.

On a month-on-month basis, the food sub-index was about 0.87 per cent in January 2018, down by 0.29 per cent from 0.58 per cent recorded in December.

The average annual rate of change of the food sub-index for the 12-month period ending January 2018 over the previous 12-month averaged 19.62 per cent, or 0.07 per cent points from the average annual rate of change recorded in December 2017 (19.55) per cent.

The report noted that the rise in the food index was caused by increases in prices of imported food in general as well as bread and cereals, milk, cheese and eggs, vegetables, fish, coffee tea and cocoa, meat, potatoes yam and other tubers and oil and fats.

The “All Items Less Farm Produce” or Core sub-index, which excludes the prices of volatile agricultural goods, stood at 12.10 per cent points during the month of January 2018, similar to rate recorded in December 2017.

On a month-on-month basis, the core sub-index increased by 0.68 per cent in January 2018 was higher from 0.51 per cent recorded in December.

The average 12-month annual rate of change of the index was 13.01 per cent for the 12-month period ending January 2018. This is 0.45 per cent points lower than 13.46 per cent recorded in December 2017.

The highest increases were recorded in prices of fuel and lubricants for personal transport and transport equipment, vehicle spare parts, accommodation services, maintenance and repair of personal transport equipment, appliances articles and products for personal care.

Other services include hotels and restaurants, hairdressing salons and personal grooming establishments, clothing materials and other articles of clothing, garments, non-durable household goods and solid fuels.

Nigeria’s GDP Rises, Records 1.40% Growth In 2017 Q3

The National Bureau of Statistics (NBS), said the nation recorded a growth in its Gross Domestic Product (GDP) by 1.40% in the third quarter of 2017.

In the third quarter report released on Monday, NBS said the growth was the second consecutive positive growth since the emergence of the economy from recession in the second quarter of this year.

According to the report, “This growth is 3.74 percent points higher than the rate recorded in the corresponding quarter of 2016 (–2.34 percent) and higher by 0.68 percent points from the rate recorded in the preceding quarter, which was revised to 0.72 percent from 0.55 percent (Q2 was revised following revisions by NNPC to oil output and hence led to revisions to Oil GDP).

It noted that quarter on quarter, real GDP growth was 8.97 percent year-to-date Real GDP growth stands at 0.43 percent.

The stats office reported that the quarter under review, aggregate GDP stood at N29,451,303.99 million in nominal terms higher when compared to N26,537,651.01 million in Q3 2016, resulting in a Nominal GDP growth of 10.98 percent.

“This growth is higher relative to growth recorded in Q3 2016 of 9.15 percent,”

NBS further disclosed that in the period under review, oil production is estimated to have averaged 2.03 million barrels per day (mbpd), 0.15million barrels higher than the revised daily average production recorded in the second quarter of 2017 (revised from 1.84mbpd to 1.87mbpd).

“Oil production during the quarter was higher by 0.42million barrels per day relative to the corresponding quarter in 2016, which recorded an output of 1.61mbpd.”

It added that real growth of the oil sector was 25.89 percent (year-on-year) in Q3 2017. This represents an increase of 48.92 percent relative to rate recorded in the corresponding quarter of 2016.

Growth also increased by 22.36 percent when compared to Q2 2017 which was revised from 1.64 percent to 3.53 percent.

“Quarter-on-Quarter, the oil sector grew by 21.10 percent in Q3 2017. As a share of the economy, the oil sector contributed 10.04 percent of total real GDP in Q3 2017, up from figures recorded in the corresponding period of 2016 and up from the preceding quarter, where it contributed 8.09 percent and 9.04 percent to GDP respectively.”

It also reported that the non-oil sector grew by -0.76 percent in real terms during the reference quarter. This is lower by -0.79 percent point compared to the rate recorded same quarter, 2016 and -1.20 percent point lower than in the second quarter of 2017.


“This sector was driven this quarter mainly by Agriculture (Crop), Other services and Electricity, gas, steam and air conditioning supply.

“In real terms, the Non-Oil sector contributed 89.96 percent to the nation’s GDP, lower than the share recorded in the third quarter of 2016 (91.91 percent) and in the second quarter of 2017 (90.96 percent),” NBS stated.

Elumelu Tasks Federal Government On Nigeria’s Economy

Mr Tony Elumelu, the Chairman, Tony Elumelu Foundation has urged the Federal Government to quickly reposition the country’s economy to prevent disaster in the nearest future.

Elumelu made the call while presenting a keynote address at the 2017 Annual Insurance Conference on Monday in Abuja.

He urged the government to re-orientate the minds of the executives that implement policies of government to see themselves as business enablers and realise the urgency of the moment.

“They must be willing and committed apostles who share the vision of their masters otherwise there will be motion without movement,’’ he said.

Elumelu reiterated the need for Nigeria to promote, attract and retain investments to achieve employment, economic empowerment and economic opportunity for the people.

 “For Nigeria to successfully position itself to promote domestic business and attract investment, the public sector must improve its process for doing business.

“We need more of our domestic investors to show the foreign investors that our country is good for business.

“The first thing we must do is to create an enabling environment for local investors so that it will serve as a signal to other investors.

“The private sector can only thrive with the support and enabling environment created by government and its agencies.

“We need the public sector to be willing partners in establishing the right investment and worthy business environment that is so needed in Nigeria; this is the only way Nigeria can show it is ready for business.’’

Elumelu said that there was the need to strengthen the country’s institutions, adding that the three arms of government needed to work together with a shared purpose to ensure Nigeria’s readiness for business.

Elumelu said that an efficient and effective infrastructure would aid more investments into the country and urged the government to ensure the right policies be put in place to attract infrastructure investment.

He recognised efforts by the President Mohammadu Buhari’s administration to ensure security in the country, stating that security was key for investors.

He stressed the need for more Nigerians to be encouraged to participate in insurance and called for the privatisation of the country’s Small and Medium Scale Enterprises (SMEs).

Elumelu noted that SMEs created the most jobs in every economy and for Nigeria to meet the demand for employment, it was important for SMEs to be well funded.

According to him, no nation can develop without massive capital injection.

“Capital mobilisation is key but we need to create the right environment to attract the capital.’’

He urged the Federal Government to position the country as an investment destination, adding that this would lead to economic prosperity that would bring hope for a brighter future.



Source: PM News

See What World Economics Has To Say About Nigeria`s Economy

World Economics is an organisation dedicated to producing financial analysis, insight and data relating to questions of key importance to the world economy.

 In a message on its website, the organization believed that things were turning around in Nigeria.

It wrote, “March Sales Managers’ Index (SMI) data suggests that the Nigerian economy is starting to grow out of the recession which saw 10 months of consecutive contraction.

“The Market Growth Index grew to 53.5 in March as the monthly Sales Growth Index edged up to 51.3, its highest value since March 2016.

“It is too early to speculate if the recovery is built on solid fundamentals for a sustained recovery but the changes reflected are not insubstantial.

“Price inflation for March, which is tracked by the Prices Charged Index, remained high at 61.3 – and indicative that very high levels of inflation continue.

“Overall, conditions in Nigeria have improved over the past month and managers are expressing optimism that the economy will continue to grow.”