Nigeria’s economic indicators point to gloom -S&P

International rating agency, Standard & Poor’s, has warned that Nigeria’s economy is in a “clear and present danger,” with a number of economic indicators pointing to gloom.

This submission was made by Standard & Poor, the global ratings agency in a presentation in Johannesburg, South Africa, on Wednesday.

This is even as data released by the National Bureau of Statistics, NBS, revealed that Nigeria earned N12.8 trillion from crude oil export in 2014.

Regional Manager, sub-Saharan Africa, for the agency, Konrad Reuss, in the presentation, said the factors putting the Nigerian economy in danger include the Boko Haram insurgency, the fall in oil prices, because of the importance of oil for government and export revenues, as well as the forthcoming elections.

Reuss explained that Standard & Poor’s rated Nigeria based on its six main categories and found out that Nigeria was weak in three classifications, namely: institutional and governance effectiveness, economic structure and growth, fiscal flexibility and performance.

In addition, Reuss who was addressing a seminar on Nigeria in Sandton, north of Johannesburg, said Nigeria was classified as neutral in external liquidity and international investment position and monetary flexibility, while its only area of strength was in its debt burden.

Reuss explained that the reason economic structure and growth was identified as a weakness was because of weakness in the structure of the economy, and not the country’s growth rate, adding that the structural problems were not being offset by the good growth.

Meanwhile, the NBS, in its Foreign Trade Statistics for the Fourth Quarter of 2014, released yesterday, estimated that with an export of N12.8 trillion, crude oil accounted for 74.4 percent of Nigeria’s total export of N17.204 trillion in 2014.

NBS stated that the highest export product for Nigeria in 2014 was mineral products, which accounted for N15,718.0 billion or 91.4 percent.

It said: “Other products that contributed immensely to Nigeria’s exports include vehicles, aircraft and parts thereof, vessels and so on, and products of the chemical and allied industries whose values stood at N357.7 billion or 2.1 percent, and N315.6 billion or 1.8 percent, respectively, of the total exports of Nigeria for the year.”

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