Nigeria’s GDP contracted in Q3 & Q4 of 2016 following weak consumption expenditures -NBS

Nigeria’s Gross Domestic Product (GDP) contracted in the third and fourth quarters of 2016, the National Bureau of Statistics (NBS) revealed on Tuesday.

In a report titled, National Gross and Domestic Product Report (Expenditure and Income Approach) for the third and fourth quarters of 2016, the NBS stated that year on year growth in GDP declined by 2.34 per cent in the third quarter, and 1.73 per cent in the fourth quarter.

The NBS said the contractions were a continuation of the negative growth trend from the first half of 2016.

Analysis of the report showed that both household consumption and government consumption expenditures contributed to the decline in the third and fourth quarters.

The NBS, however, observed that a strong recovery in growth in net exports, especially in the fourth quarter, helped to stem the decline.

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Also, the National Disposable Income recorded a strong growth in comparison to the GDP in the second half of 2016 in real terms, “partly as a result of increases in ‘other net transfers from the rest of the world’”, the NBS said.

Year on year growth in domestic Compensation of Employees declined in real terms, the report said, adding that operating surplus also declined in the third and fourth quarters but grew overall in real terms in 2016.

Recall that the Nigerian economy had slipped into recession in 2016 after contracting for two consecutive quarters.

On September 5, 2017 however, the NBS announced that the economy had exited recession.

It reported that in the second quarter of 2017, the GDP grew by 0.55 per cent 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 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),” the NBS said.

 

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