Macroeconomic Report & Economic Updates
February 1, 2017
Nigeria Economic Review
Global economic growth remained
fairly stable in 2016Q3 with baseline projections for global growth at 3.1 percent and 2.4
percent by International Monetary Fund (IMF) and the World Bank respectively.
Growth in developed countries was moderate but unevenly distributed: while the
U.S and the UK showed improvements, growth in other economies remained tepid.
Among emerging countries, India witnessed higher growth while growth in China
remained constant but the Chinese Yuan continued to appreciate. Given that
India is Nigerias major crude oil importer, improving economic conditions in
India may translate into rising demand for Nigerias crude oil. However, the
continuous appreciation of the Yuan poses significant inflationary threat in
Nigeria given the high level of imports from China. Subdued global demand, weak
trade, uncertainties in commodity prices and consequences of the Brexit were
the key constraining factors to growth over the period. In addition, growth in
Sub-Saharan African countries remained generally slow on the account of low
commodity price, political turmoil, and inconsistent government policies.
Related
Understanding The Ongoing Recession In Nigeria:A Synthesis Of The Events And Policy Options
In
the second quarter of 2016, the Nigerian economy witnessed its first recession
in twenty years due to the interplay of several external and internal factors.
The recession has continued until date and has given rise to relentless
unemployment rate and job losses, double digit and soaring inflation, currency
depreciation and widening gap between parallel market and official exchange
rates, amongst other adverse effect on individuals and firms in the country.
Thus, there is a need to take a deeper look into the nature of the present
recession as well as the impact of monetary and fiscal policy responses thus
far, in order to shed light on the way forward towards tackling the recession
and ensuring sustainable economic growth. This paper analyses the ongoing
recession in the Nigerian economy to provide insights into the interplay of
events and recommendations for policy.