Breaking News: Nigeria unexpectedly exits recession with 0.11% Q4 GDP growth

Chidi Ogbuokiri

Nigeria’s economy unexpectedly came out of a recession in the fourth quarter as restrictions to curb the spread of the coronavirus were eased.

Gross domestic product grew 0.11 per cent in the three months through December from a year earlier, compared with a decline of 3.6 per cent in the third quarter, the Abuja-based National Bureau of Statistics said on its website on Thursday.

The median estimate of five economists in a Bloomberg survey was for a quarterly decline of 1.8 per cent.

The economy contracted 1.92 per cent for the full year, the most since at least 1991, according to International Monetary Fund data.

The surprise rebound means Africa’s largest economy may recover faster than expected as the oil price and output increase this year.

It could also point to the growing dominance of the non-crude sector, according to Joachim MacEbong, a senior analyst at SBM Intelligence in Lagos.

Oil production fell to 1.56 million barrels a day in the fourth quarter from 1.67 million barrels in the previous three months.

While crude contributes less than 10 per cent to the country’s GDP, it accounts for nearly all foreign-exchange earnings and half of government revenue in continent’s biggest producer of the commodity.

The government’s forecast for growth of 3 per cent this year is double that of the IMF.

A stronger recovery could ease pressure on the central bank to stoke activity, paving the way for a renewed focus on its price stability mandate.

Accotding to a Bloomberg report, “That means the monetary policy committee could start raising interest rates again to fight inflation that’s been above the target band of 6 per cent to 9 per cent for more than five years. The panel eased by 200 basis points in 2020.”