Despite the positive news regarding the Nigerian economy Nigeria Exits Recession, GDP Grows By 0.11%, experts contend with the economic prognosis of the Nigeria Bureau of Statistics (NBS).
In a report titled, ‘Nigeria’s Gross Domestic Product for Q4 and full-year 2020’, the NBS had stated that the economy experienced a slight expansion by 0.11 percent in the fourth quarter of 2020.
It also noted in the report that in 2020, Nigeria’s GDP shrunk by 1.92 percent.
The NBS said that the positive growth was a sign of a gradual return of economic activities after the restriction on movements was eased.
It said that the growth rate for Q4 2020 was lower than 2019’s by 2.44 percent and 3.74 higher than Q3 2020.
The bureau said, “Nigeria’s Gross Domestic Product 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.
“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 growth rate recorded the previous year by 2.44 per cent points, it was higher by 3.74 per cent points 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 4.2 per cent points when compared to the 2.27 per cent recorded in 2019.”
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Expert’s View On Recession
Speaking on the report, an Economics professor at the Olabisi Onsbanjo University, Sherrifdeen Tella, stated that the NBS was wrong to have adjudged that the recession was over based on one factor.
He said that before the bureau can come to a conclusion about the growth of the country’s economy, factors that should be considered include a drop in inflation, an improvement in the exchange rate, and a decline in the rate of unemployment.
He capped it of by stating that the country was “still in recession”.
He said, “I don’t think NBS is right because you don’t judge ending of recession based on one economic factor or variable.
“Other factors like inflation must be coming down, exchange rates must be improving and then unemployment should also be going down. The country is still in recession.”
He added, “So the economy is still in recession up till now because we still have a high level of unemployment, inflation is still rising, the exchange rate is still depreciating and even the GDP that they said has gone up just did after the report of this month when the price of oil has gone up. That’s not the actual growth that’s even required.”
