Nigeria, Africa’s second largest economy, has officially entered a state of economic recession for the first time in over 20 years. This comes after current figures revealed that the economy contracted for a second consecutive quarter.
According to the Nigeria Bureau of Statistics, the country’s Gross Domestic Product (GDP) contracted by 2.06% in the second quarter. The GDP shrunk by 0.36%.
A recession is a period of temporary economic decline during which trade and industrial activities are reduced, generally identified by a fall in GDP in two successive quarters.
The cause of the slump is believed largely to be as a result of the slump of oil prices on the world market. That situation has been worsened by renewed insurgency in the Niger Delta region, the attacks on oil installations continue to disrupt production of oil in the region.
CEO of the NBS and Statistician General of the Federation, Yemi Kale, noted that there were contractions in most parts of the economy including the manufacturing, real estate, road, construction, human health and social services and the fishing sector.
He also spoke about unemployment rate in the country and how the country was fairing in the global ranking. Nigeria ranked better than 43 countries with 136 others doing better than Africa’s most populous country.
15. Nos of unemployed rises by 1,158,700 persons resulting in increase in unemployment rate to 13.3% in q2 2016 (12.2%-q1; 10.4%-q4 2015)— Dr Yemi Kale (@sgyemikale) August 31, 2016
20. 43 countries have higher unemployment rate than Nigeria & 136 have lower rates with Qatar lowest(0.2%) & Djibouti highest(54%)— Dr Yemi Kale (@sgyemikale) August 31, 2016
The Finance Minister, Kemi Adeosun, had earlier in July stated that people should not dwell on the recession but rather on where the country is going through the measures being taken to save the economy.
“Is Nigeria in recession? Technically if you go into two quarters of negative growth, technically, you’re in recession but I don’t think we should dwell on definitions, I think we should really dwell on where we are going.”