Nigeria’s GDP dips to two per cent in Q1 2019

•Analysts predict more shocks, urge immediate action
The nation’s Gross Domestic Product (GDP) reversed its major leap in fourth quarter of 2018 from 2.39 per cent to 2.01 in the first quarter of 2019, representing a decline of -0.38 per cent points.

The development, which is an indication of sustained recovery crisis since the economy’s exit from recession in 2017, followed a disappointing surprise in inflation to 11.37 in April, from 11.25 per cent in March that defied all forecasts.

However, in comparison to the first quarter of 2018, which recorded real GDP growth rate of 1.89 per cent, the Q1 2019 figures represented an increase of 0.12 percentage points.

The National Bureau of Statistics (NBS), despite affirming the poor record, noted that although the general elections were held across the country in the period, the figures were the strongest first quarter performance observed since 2015.

“Aggregate GDP stood at N31.79 trillion in nominal terms. This aggregate was higher than in the first quarter of 2018, which recorded N28.44 trillion, representing a year-on-year nominal growth rate of 11.80 per cent.

“The aggregate was, however, lower than in the preceding quarter’s N35.23 trillion, by -9.75 per cent. The nominal GDP growth rate in Q1 2019 was higher than the rate recorded in Q1 2018 by 2.54 per cent points,” the NBS report stated.

In the first quarter of 2019, average daily oil production stood at 1.96 million barrels per day (mbpd), lower than the average daily production of 1.98 mbpd recorded in the same quarter of 2018, but higher than the fourth quarter of 2018 production volume by 0.05mbpd.

Meanwhile, experts have described the development as gloomy amid unrealised opportunities, noting that Nigeria’s “redemption” at the moment lies on the ability of the policymakers in scripting clear growth initiatives and implementing them without delay.

Frontline economist, Bismarck Rewane, said three issues worked against the economy in the period under review, including the usual seasonal challenge of every first quarter.

He said the elections had its own challenge, while the lack of catalysts to boost growth drive, exemplified in the disharmony between monetary and fiscal policies fostered investment uncertainties.

The managing Director of Cowry Asset Management Limited, Johnson Chukwu, said the slowdown was discouraging, given that the population had continued to grow at three per cent, thus creating more challenges for the economy.

Also, FXTM Research Analyst, Lukman Otunuga, said the parlous scorecard was partly due to external risks and contraction in the oil sector.