Nigeria Economic Review Second Quarter Report 2016
An overview of the Nigerian economy is presented in this report by examining key macroeconomic indicators, external sector performance and key domestic sector performance in 2016Q2. The evidence presented shows that the internal and external sector performance of the Nigerian economy have been highly unimpressive in 2016Q2 as the stagnated economy slipped into a recession– the first in over two decades. In 2016Q2, GDP growth rate fell to -2.06% while inflation, unemployment and under employment rose consistently. Trade deficit increased, foreign investment declined, foreign exchange earnings remained suppressed, and the value of the Naira depreciated significantly. All key sectors of the economy under performed considerably with the exception of the agriculture sector while overall domestic performance is alarming, the outlook remained fairly positive as present challenges are surmountable. Nigeria still has the large population, natural resources, trained manpower and demographic dividend to allow the economy do well. More than ever before, the coordination and harmonization of fiscal and monetary policies is crucial. However, a greater onus lies with fiscal authorities to provide the necessary stimulus on infrastructures and tackle persisting structural challenges. At the same time, the CBN should continue to adopt contractionary policies alongside a clear, consistent and strictly implemented foreign exchange management policies.