Nigeria’s economy beats World Bank, IMF estimates, emerges from recession

Nigeria, Africa’s biggest economy, has snapped out of recession as it recorded positive growth in the fourth quarter of 2020, contrary to expectations of the World Bank and the International Monetary Fund.

The country’s Gross Domestic Product expanded slightly by 0.11 percent in Q4, with annual real GDP growth of -1.92 percent, figures released by the National Bureau of Statistics on Thursday showed.

The World Bank had said in its ‘January 2021 Global Economic Prospects’ that the Nigerian economy was estimated to have contracted by 4.1 percent in 2020, as the effects of the pandemic impacted economic activity in all sectors.

“Growth in Nigeria is expected to resume at 1.1 percent in 2021. Activity is nevertheless anticipated to be dampened by low oil prices, OPEC quotas, falling public investment due to weak government revenues, constrained private investment due to firm failures, and subdued foreign investor confidence,” it added.

The IMF said earlier this month that following a sharp drop in oil prices and capital outflows, the country’s real GDP “is estimated to have contracted by 3.2 percent in 2020 amidst the pandemic-related lockdown.”

Nigerian slipped into recession in the third quarter of last year as the GDP contracted by 3.62 percent after shrinking by 6.10 percent in Q2.

The NBS said, “Nigeria’s Gross Domestic Product grew by 0.11 per cent (year-on-year) in real terms in the fourth quarter of 2020, representing the first positive quarterly growth in the last three quarters. 

“Though weak, the positive growth reflects the gradual return of economic activities following the easing of restricted movements and limited local and international commercial activities in the preceding quarters. 

“Overall, in 2020, the annual growth of real GDP was estimated at 1.92 per cent, a decline of 4.2 per cent points when compared to the 2.27 per cent recorded in 2019.”