Nigeria exits recession… As CBN Governor, Emefiele predicted

At last, as predicted by the Governor of the Central Bank of Nigeria(CBN), Mr. Godwin Emefiele, Nigeria has exited recession that lasted for about five quarters since 2016.  According to the National Bureau of Statistics (NBS) in its Quarter 2, 2017 GDP Report released Tuesday, September 5, 2017. The GDP grew by 0.55 per cent (year-on-year) in real terms in the second quarter of 2017.

The report shows that the GDP shrank by 0.52 per cent (year-on-year) in real terms in the first quarter of 2017, representing the 5th consecutive quarters of contraction since the first quarter of 2016.  The GDP’s growth by 0.55 percent, according to the report is 2.04 per cent higher than the rate recorded in the corresponding quarter of 2016 ( –1.49 per cent) and higher by 1.46 per cent points from rate recorded in the preceding quarter, (revised to –0.91 per cent from –0.52 per cent). Thus, quarter on quarter, real GDP growth was 3.23 per cent.

Meanwhile, it will be recalled that the Governor of Central Bank of Nigeria, CBN, Mr. Godwin Emefiele had predicted on 23^rd May, 2017 that at the end of third quarter 2017, Nigeria would be out of recession. Emefiele confidently underscored the possibility of the exit based on the obvious positive economic indices such as downward trending inflation rate, improvement in the GDP growth rate, noting that negative growth rate had decelerated quite significantly, coupled with improvement in the quantum of foreign exchange going to the real sector and industrial capacities.

In his prediction, Mr. Emefiele had said, “We’ve seen positive signs in various economic sectors, I am very confident that at the end of the third quarter, we will be out of this and I still hold that position”.

The development, coming on the heels of more stable exchange rate regime, coupled with declining inflation rate, from 16.10 per cent in June down to 16.05 per cent in July, 2017, it is believed that these factors will provide salutary macro-economic conditions for growth, as anchored on the current monetary policy stance of the CBN.