• Privacy Policy
  • Terms
  • About us
  • Contact Us
Thursday, June 8, 2023
  • Login
TheMattersPress
  • Home
  • News
  • Features
  • Thematterspress
  • Multimedia
    • Audio
    • Photo
    • Video
  • About us
  • Contact Us
No Result
View All Result
  • Home
  • News
  • Features
  • Thematterspress
  • Multimedia
    • Audio
    • Photo
    • Video
  • About us
  • Contact Us
No Result
View All Result
TheMattersPress
No Result
View All Result
Home News

Economic downturn throws Nigeria into another recession

The Matters Press by The Matters Press
November 22, 2020
Reading Time: 3 mins read
0
Economic downturn throws Nigeria into another recession

RELATED POSTS

Motorists shun petrol filling stations as pump price peaks

Depot associations support subsidy removal, pledge 100 mass transit buses

Naira extends stability at investors, exporters window

By Tanko Mohammed

For the second time in five years, Nigeria’s fragile economy has entered into a deep recession.

The National Bureau of Statistics (NBS) reported on November 21, 2020 confirmed that aside that of 2016, Nigeria has entered another recession as the Gross Domestic Product (GDP) has contracted for the second consecutive quarter by 3.62 percent in the third quarter of (Q3) 2020.

A recession is a period of decline in general economic activity, typically defined when an economy experiences a decrease in its gross domestic product for two consecutive quarters.

The nation, Africa’s biggest economy, is currently grappling with a debt burden of $86 billion, inflation rate of 14.23 per cent, and a dip in national revenue by 60 percent.

Production in oil and non-oil sectors has dipped and unemployment spiralled, all caused by impact of coronavirus pandemic and global economic crisis, especially the glut in crude oil, the main source of revenue to sustain the 200 million people of Nigeria.

Economic recession is defined as two consecutive quarters of negative Gross Domestic Product (GDP) growth. Negative GDP growth is also referred to as a contraction.

According to NBS report for the third quarter of 2020 the nation recorded GDP growth of -3.62% though an improvement from the -6.10% growth recorded in the second quarter.

ALSO READ  AfCFTA’s potential for enterprises dominates discussion

“Nigeria’s gross domestic product (GDP) recorded a growth rate of –3.62% (year-on-year) in real terms in the third quarter of 2020.

“Cumulatively, the economy has contracted by -2.48%. While this represents an improvement of 2.48% points over the –6.10% growth rate recorded in the preceding quarter (Q2 2020), it also indicates that two consecutive quarters of negative growth have been recorded in 2020.”

NBS stated on its website that, furthermore, growth in Q3 2020 was slower by 5.90% points when compared to the third quarter of 2019 which recorded a real growth rate of 2.28% year on year.

It said that the performance of the economy in the third quarter (Q3) reflected residual effects of the restrictions to movement and economic activity implemented across the country in early second quarter (Q2) in response to the COVID-19 pandemic.

“As these restrictions were lifted, businesses re-opened and international travel and trading activities resumed, some economic activities have returned to positive growth. A total of 18 economic activities recorded positive growth in Q3 2020, compared to 13 activities in Q2 2020.”

“During the quarter under review, aggregate GDP stood at N39.089 trillion ($108 billion) in nominal terms. This performance was 3.39% higher when compared to the third quarter of 2019 which recorded an aggregate of N37.806 trillion ($104 billion).

This rate was, however, lower relative to growth recorded in the third quarter of 2019 by –9.91% points but higher than the proceeding quarter by 6.19% points.

ALSO READ  Lull in solid minerals sector causes concerns

Nigerian economy has been broadly classified into the oil and non-oil sectors and currently with average daily oil production recorded in the third quarter of 2020 stood at 1.67 million barrels per day (mbpd), or 0.37mbpd lower than the average production recorded in the same quarter of 2019 and 0.14mbpd lower than production volume recorded in the second quarter of 2020

“Real growth for the oil sector was –13.89% (year-on-year) in Q3 2020, indicating a sharp contraction of –20.38% points relative to the rate recorded in the corresponding quarter of 2019.’’

Oil growth decreased by –7.26% points when compared with oil sector growth recorded in Q2 2020 (6.63%).

Quarter on quarter, however, the oil sector recorded a growth rate of 9.64% in Q3 2020. The sector contributed 8.73% to total real GDP in Q3 2020, down from 9.77% and 8.93% respectively recorded in the corresponding period of 2019 and the preceding quarter, Q2 2020.

The non-oil sector grew by –2.51% in real terms during the reference quarter, which is –4.36% points lower than the rate recorded in Q3 2019 but 3.54% points higher than in the second quarter of 2020.

The non-oil sector was driven mainly by Information and Communication (Telecommunications), with other drivers being Agriculture (Crop Production), Construction, Financial and Insurance (Financial Institutions), and Public Administration.

“In real terms, the non-oil sector contributed 91.27% to the nation’s GDP in the third quarter of 2020, higher than its share in the third quarter of 2019 (90.23% ) and the second quarter of 2020 (91.07%).”

ALSO READ  UNGA: Buhari addresses the World

Manufacturing sector contracted by -1.51% in Q3 2020 from -8.78% in Q2 2020 and 1.1% in Q3 2019. The contribution of Manufacturing to nominal GDP in Q3 2020 was 13.56%, higher than in the corresponding period of 2019 (12.34%) and the second quarter of 2020 (11.79%).

Finance minister Zainab Ahmed on May 21, 2020 told the nation that Nigeria would slide into a recession but with reduced impact if the Economic Accessibility Committee continues with its stimulus packages.

Mrs Ahmed said: “And if we applied all that have been proposed and we are able to implement it we may end up with a recession that is -0.4 per cent. In any case, we will go into recession but what we are trying to do is to make sure that it is shallow so that we will quickly come out of it come 2021.”

She said the Nigeria is going through a very difficult time because the challenges have now doubled – there is health challenge, there is an economic challenge.

“We have to feed the people and you can only feed the people if people go out and farm. We are a very large population, we don’t want to take the risk and we don’t have enough fund to cushion the effect,” she said.

Tags: Recession
ShareTweetPin
The Matters Press

The Matters Press

Related Posts

July petrol pump price ranges between N140.80 and N143.80
Economy/Technology

Motorists shun petrol filling stations as pump price peaks

June 8, 2023
Stable petrol supply excites Buhari
Economy/Technology

Depot associations support subsidy removal, pledge 100 mass transit buses

June 8, 2023
“Naira-4-Dollar” getting results
Economy/Technology

Naira extends stability at investors, exporters window

June 8, 2023
World Bank predicts 4% global economic growth, 1.1% for Nigeria in 2021
Economy/Technology

Global economy in ‘precarious position’, World Bank warns

June 8, 2023
36 governors support fuel subsidy removal, other policies
Economy/Technology

36 governors support fuel subsidy removal, other policies

June 8, 2023
Tinubu denies manipulating NASS
Economy/Technology

Tinubu directs NEC to work on palliatives

June 7, 2023
Next Post
States in race for Medical Free Zone

States in race for Medical Free Zone

Nigerian firms to handle $4b gas project

Buhari inaugurates modular refinery in Imo, sees bright future for refined products

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recommended Stories

Infrastructure gulp N2,7tn in Nigeria

Infrastructure gulp N2,7tn in Nigeria

January 11, 2019
Itakpe-Warri rail kicks off after 30 years

E-ticketing, staff training way to go to satisfy rail customers

January 30, 2022
Customs generates N493.75bn in TinCan Island

Nigeria Customs Service revenue hits N2.3trn

December 21, 2021

Popular Stories

  • Rising prices of goods cause protests in Morocco

    Rising prices of goods cause protests in Morocco

    0 shares
    Share 0 Tweet 0
  • NLNG not responsible for gas supply shortfall, price hike

    0 shares
    Share 0 Tweet 0
  • Hoarding causes hike in prices of grains

    0 shares
    Share 0 Tweet 0
  • NCC sets fresh operational fees, spectrum prices for telecom operators

    0 shares
    Share 0 Tweet 0
  • Prices of Petrol, diesel increase in November

    0 shares
    Share 0 Tweet 0
TheMattersPress

We bring you the best news update in Nigeria

LEARN MORE »

Recent Posts

  • Motorists shun petrol filling stations as pump price peaks
  • Depot associations support subsidy removal, pledge 100 mass transit buses
  • Naira extends stability at investors, exporters window

Categories

  • Agriculture
  • Economy/Technology
  • Energy
  • Entertainment/sports
  • Features
  • Foreign
  • Multimedia
  • Natural Resources
  • News
  • Oil and Gas
  • Photo
  • Politics
  • Security
  • Thematterspress
  • Uncategorized
  • Video

© 2022 Domo Tech World - Powered by Thematterspress.

No Result
View All Result
  • Home
  • News
  • Features
  • Thematterspress
  • Multimedia
    • Audio
    • Photo
    • Video
  • About us
  • Contact Us

© 2022 Domo Tech World - Powered by Thematterspress.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
Call Us
Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?