Following Tuesday’s pronouncement by the National Bureau of Statistics (NBS) that Nigeria, which has been reeling under excruciating pains of recession since late 2015 may be gradually exiting it, mixed reactions have expectedly begun trailing it.
The NBS provides comprehensive, timely, relevant, responsive and customer focused statistical information. Although, Nigerians have expressed divergent views from across the broad spectrum of the society, investigations by The Daily Times indicated that cautious optimisms have underpinned such reactions.
Indeed, from the organised labour, financial analysts, private sector players, market men and women, those spoken to, while welcoming the NBS’s pronouncement as soul-lifting for the country, more so as it would significantly reduce the pains and pangs Nigerians had been going through, espoused that there were still many contending issues to be addressed in order to practically overcome both the micro and macro challenges that recession has foisted on the nation.
While some have faulted the NBS’ position, saying that its statistics are never reliable, they argued, rightly or wrongly though that going by hyper-inflation, unemployment, poverty, squalor and want still pervading the length and breadth of the country, there was the need for the government at all levels, including the private sector and, indeed, all Nigerians to critically demonstrate maturity in handling the pronouncement.
The Federal Government, in separate statements, said that “Exit from recession an indication of Buhari’s performance.” Presidential spokesman, Femi Adesina, in his reaction, said Nigeria’s exit from economic recession is a clear testimony that President Muhammadu Buhari’s administration is working for the progress and prosperity of all Nigerians.
Adesina made the declaration on Tuesday in Abuja while addressing a solidarity rally for the Federal Government organised by the Centre for Civil Society and Justice.
Speaking at the rally at the precincts of the Presidential Villa, he said:
“You have chosen a very auspicious day for this solidarity rally. Earlier today, we were told that Nigeria had officially exited recession.
“That shows that we have a government that is working for us. We have a government that is interested in our welfare. We have a government that is interested in our well-being.
“Recession came due to some mistakes of the past and in just about a year, the government battled it and today we are officially out of recession and we give all glory to God.’’
The Presidency also said that “The figures released by the National Bureau of Statistics for the second quarter of this year (Q2 2017), show 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 Nigerian 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 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%. It adds that, “Overall, industry as a whole grew by 1.45% in Q2 2017 after nine successive quarters of contraction starting in Q4 2014.
This positive development was somewhat overshadowed by the continued decline in the services sector which accounts for 53.7% of GDP.
Nevertheless, electricity and gas as well as financial institutions grew by 35.5% and 11.78% respectively in Q2 2017. “The GDP figures give grounds for cautious optimism especially as inflation has continued to fall from 18.72% in January 2017 to 16.05% in July 2017.
Foreign exchange reserves have similarly improved from a low of $24.53 in September 2016 to about $31 billion in August 2017.
In the same vein capital importation grew by 95% year-on-year driven by portfolio and other investments but also notably by foreign direct investment which increased by almost 30% over the previous quarter.”
But the Central Bank of Nigeria (CBN) has said that the report of Nigeria’s exit from recession was a confirmation of CBN governor’s prediction that the economy will exit recession by the second quarter of 2017.
In a statement by its Acting Director, Corporate Communication, Mr Isaac Okorafor, the CBN said that the governor of the apex bank, Mr Godwin Emefiele, had predicted that Nigeria would soon exit recession that lasted for about five quarters since 2016.
Emefiele had predicted on May 23, 2017 that at the end of third quarter 2017, Nigeria would be out of recession.
In his prediction, 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”.
Meanwhile, the Senate has disclosed that it is commendable that after five consecutive quarters of contraction, the Nigerian economy grew by 0.55 per cent in the second quarter of 2017.
Speaking through its spokesman, Senator Sabi Abdullahi, the Senate added that the improved performance of the trade, manufacturing, agriculture and oil sectors, was an indication that with carefully aligned policy and legislative interventions, Nigeria’s economy could thrive beyond current forecasts and expectations.
The Senate spokesman said, “The Senate received Q2 NBS economic report with great excitement. We are delighted that government’s response to the economic recession has began to yield tangible results.
“The public will recall that in the days following the announcement of the 2016 recession, the Senate initiated steps and tabled 21 recommendations that it submitted to the executive for immediate action.
We also listed out economic priority Bills, many of which have now been passed, or at the final stage. “We are also happy to note that many of the economic recommendations, specifically in the areas of retooling our agriculture and trade policies were adopted.
This shows that the ‘all hands on deck’ approach was necessary from both branches on government,” The Daily Times recalls that the NBS, on Tuesday (yesterday) announced that the country has exited recession.
Indeed, due to prolonged economic downturn in the country, Nigerians, who are into Micro Small and Medium Enterprises (MSMEs) have bemoaned its continued negative effects on their businesses and livelihood, investigation by The Daily Times has revealed.
According to the NBS, while justifying its claim, “In the second quarter of 2017, the nation’s Gross Domestic Product (GDP) grew by 0.55% (year-on-year) in real terms, indicating the emergence of the economy from recession after five consecutive quarters of contraction since Q1 2016.
“This growth is 2.04% higher than the rate recorded in the corresponding quarter of 2016 (–1.49%); and higher by 1.46% points from rate recorded in the preceding quarter, (revised to –0.91% from –0.52%).
Quarter on quarter, real GDP growth was 3.23%,” the NBS said. It adds, “During the quarter, aggregate GDP stood at N26,986,005.20 million in nominal terms, compared to N23,547,466.91m in Q2 2016, resulting in a Nominal GDP growth of 14.60%.” Indeed, operators in the troubled industrial sector have said they were beginning to notice ‘remarkable positive signs’ in their books, going by recent developments in the county.
Specifically, their umbrella body, Manufactures Association of Nigeria (MAN) has said it was overcoming those challenges, including Forex, raw material, infrastructure like electricity, fuel and low capacity utilisation that had brought its members to their kneels over the past m 30 months.
Accordingly, MAN said that manufacturing is growing out of recession, as it has recorded positive growth in the first quarter of 2017.
The President, MAN, Dr. Frank Jacobs, stated this during a breakfast meeting for directors/chief executive officers in Lagos. Jacobs, who was represented by the Director General, MAN, Mr. Ajayi Kadri, noted that the manufacturing sector’s real output growth moved into positive region by recording 1.36 per cent in the first quarter of 2017 against -2.54 per cent recorded in the fourth quarter of 2016.
Even the Federal Government had been upbeat that its economic policies were beginning to impact positively on Nigerians. President Muhammadu Buhari, while reacting to how Nigerians have fared under his regime, since his All Progressives Congress (APC) took over the reins of governance since May 29, 2015, has said that the economy, under his watch, was recovering very fast.
He said that he was pleased with the progress being made on different fronts, such as power, roads, anti-corruption fight, agriculture, solid minerals, Treasury Single Account, ease of doing business, etc, to rejig the economy and steer it back on track, in spite of the challenges facing his administration.
But many Nigerians say it was not yet Uhuru for the economy. They contend that the NBS’ position lacked empirical evidence; and should be taken with a pinch of salt.
According to the Association of Banks, Insurance and Financial Institutions (ASSBIFI), there is nothing to celebrate yet. While reacting to a text message sent to her, President, Association of Banks, Insurance and Financial Institutions, Comrade (Mrs.) Oyinkansola Olasanoye, said that “Statistically, we may be out of recession, but the rate of job loss, companies folding up and the cost of foodstuffs and daily necessities signify that the recession is still with us.”
Also, Chairman, Nigeria Professional Shareholders Association, Mr. Godwin Anono, reacting on the recent report by NBS on end of recession, said that the report was diversionary from the real situation on ground. “Our leaders don’t always want to tell the common man the truth.
How will they now tell us that recession has ended in the country when more families cannot afford a square meal, many workers are being retrenched and those still in employment are not being paid? Speaking to The Daily Times, Anono said that Nigerians do not need anybody or group to tell them if suffering in the land is abating or worsening, because the people, who are in the middle of the storm can tell the story themselves.
He said: “How can you say you are recording economic growth and suffering is worsening? Go to the market and price goods and other food items, you will find out that Nigeria will have to endure more years before coming out of recession”.
According to him, the prices of staple foods like Garri, beans, rice, Semovita, wheat, meat, egg and even pure water amongst others have remained high, which is why many families cannot boast of a good meal every day.
“Now, many people are begging to have at least food to feed their families, while the companies are continually retrenching people or closing down.
This hardship we are facing, the people in government house are not facing it that is why they want to make us believe that the recession is over.”
Apart from these categories of people, others like civil servants were not easily swayed by the NBS. For example, Mrs. Ojo Akindele, a civil servant, said that the verdict by the NBS was commendable and a reflection of what most Nigerians had been yearning for, adding that it would help to cool the tension in the country.
She said that the word recession had fueled increase in goods and services that had not gone down well with the masses. She added that many traders took advantage of recession to increase the prices of their products.
Mr. Abdulahi Mustapha, a businessman, said that until the dollar crashed against the naira and prices of electronics and furniture were reduced, he would not believe the NBS report.
He said that it was the recession that led to the high prices of goods and until the prices crashed, he would not join in the celebration, adding however that he still remained the fan of President Muhammadu Buhari. Mr. Sunday David, an artisan, said that Nigeria was never in recession, adding that it was some pockets that were in recession; while other pockets were still full of money; hence they never felt the pain of recession.
He said that enemies of Nigeria stole so much that the country found itself in recession, adding that the government should not relent in its quest to retrieve back the country’s money.
But in spite of Nigerians’ diverse views, the Presidency was ecstatic about the NBS’ pronouncement. Ganiyu Obaaro, Bonny Amadi, Motolani Oseni, Lagos and Samuel Idowu, Mathew Dadiya, Abuja
