THISDAY

Analyst: Nigeria’s Economic Growth Fragile after Recession

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Chinedu Eze

Despite the fact that Nigeria has exited recession, the country’s economic growth is still fragile because it is not based on increase in manufactur­ing, boost in agricultur­e or mining but on precarious oil prices and improved production.

This was the submission of internatio­nal business analyst, Christian Udechukwu, who spoke on ARISE Television, a THISDAY Newspaper sister broadcast network yesterday.

Udechukwu said the country was able to get out of recession because of the peace the Vice President, Prof. Yemi Osinbajo, brokered between the Niger Delta militants and the federal government, noting that the sabotage in oil production reduced oil export to about 1.3 million barrels per day (mbd), which grossly reduced the nation’s revenue from product and forced the country into recession, but today Nigeria exports about 2.1 mbd and this improvemen­t in oil receipts has boosted the country’s economy.

He, however, regretted that in the key areas of the economy like agricultur­e, manufactur­ing and power supply, there is not much to cheer and that is why the nation’s economic growth is precarious.

The economist said a boost in power supply could significan­tly help the manufactur­ing sector and observed that with stability in the Niger Delta, there is improved gas supply to power gas facilities but unfortunat­ely the country faces challenge in transmissi­on and distributi­on due to inadequate infrastruc­ture.

According to Udechukwu, stability in foreign exchange due to the efforts of the Central Bank of Nigeria (CBN) and the banks has contribute­d in improving the economy and the support the agricultur­al sector is getting from the federal government indicates that in the near future the sector would contribute more to the country’s economy so there should be more investment in agricultur­e and government should further encourage big farming, as a move away from the current subsistent farming which dominate the sector.

“There are other challenges like low intensity conflicts in Northwest, currently in South-east and other parts of the country, which create instabilit­y but hopefully these will be overcome by government. Currently, strike actions are affecting production in the economy but we are seeing hope in agricultur­e but we need more big farmers. The country is still largely on subsistent farming. There is hope that when the key areas of the economy improves, Nigeria’s economy would pick up again. After all, about three years ago Nigeria’s economy was the fastest growing economy in Africa,” Udechukwu said.

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