“Until coming out of recession translates into meaningful improvement in people’s lives, our work cannot be said to be done.’’
These were the words of President Muhammadu Buhari on Tuesday, September 5, 2017, noting that despite the claim by the National Bureau of Statistics (NBS) that the country has exited recession, the real impact would be better felt when ordinary Nigerians experience a change in their living conditions. Ordinary Nigerians cannot see an end to the recession as long as the prices of food items are still high.
The presidency said it welcomed the news with cautious optimism even as it pledged to vigorously drive the economic recovery and growth plan of the administration.According to the presidency, the overall economic plan of the administration has resulted, among others, in the sustained restoration of oil production levels occasioned by the enhanced security and stability in the Niger Delta, growth in agriculture, mining and the first growth recorded in industry as a whole in the last nine quarters since Q4 2014.
A statement by the Special Economic Adviser to the President, Dr. Adeyemi Dipeolu, on the second quarter of 2017 (Q2 2017) figures released yesterday by the NBS shows that “the economy grew in Q2 2017 by 0.55% from -0.91% in Q1 2017 and -1.49% in Q2 2016.” This in effect means that the nation’s economy has exited recession after five successive quarters of contraction.
“This positive growth is attributable to both the oil and non-oil sectors of the economy. Growth in the oil sector which has been negative since Q4 2015 was positive in Q2 2017.
“It rose by 1.64% as compared to -15.60 in Q1 2017, an increase of up to 17 percentage points. This improvement is partly due to the fact that oil prices which have improved slightly from the lows of last year have been relatively steady as well as the fact that production levels were being restored. “The non-oil sector grew by 0.45% in Q2 2017, a second successive quarterly growth after growing 0.72% in Q1 2017. This increase which was not quite as strong as it was in Q2 2016 reflects continuing fragility of economic conditions.
“However, given that nearly 60% of the non-oil sectors’ contribution to GDP is influenced by the oil sector, growth in the oil sector will help boost the rest of the economy,” the statement said.Dipeolu observed that the positive growth seen in agriculture when the rest of the economy was contracting was maintained at 3.01% which is encouraging especially if seasonal factors are taken into account.
“Manufacturing growth was also positive at 0.64% and although lower than the previous quarter’s growth of 1.36%, it was a noticeable improvement over the -3.36% experienced in Q2 2016 and a continuation of the turnaround of the sector.
“Solid minerals which remain a priority of the administration also continued to grow and in Q2 2016 by 2.24%. Overall, industry as a whole grew by 1.45% in Q2 2017 after nine successive quarters of contraction starting in Q4 2014,” he said.
Although the latest figures from the NBS show the country is out of recession, economists, like President Buhari, have warned that it may be too early to cheer considering the delayed impact at the micro-level and the need for sustainable economic programmes. According to the experts, economic recovery needs to be sustained through improved productivity and downward revision of the interest rates for a spiral effect on consumer goods and food prices.
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