Nigerian Economy Maintained Positive Growths in All Quarters of 2021, Says MAN

The Manufacturers Association of Nigeria, (MAN), has revealed in its half yearly review of the economy, that the Nigerian economy picked up in 2021 after the country exited the 2020 recession in the fourth quarter (Q4) of 2020.

The report showed that the manufacturing sector output growth increased to 3.37 percent in 2021 from -2.85 percent of 2020, while the sector however, according to the National Bureau of Statistics (NBS) maintained positive growths through all the quarters of 2021: 3.4 percent in Q1; 3.49 percent in Q2; 4.29 percent in Q3; and 2.28 percent in Q4 2021.

Nigerian economy, it noted, picked up in 2021 after the country exited the 2020 recession in the fourth quarter of 2020, while the fourth quarter report of NBS in 2021 revealed the fifth positive growth after the recession, which reflected the return of economic activities in the country.

Although, the data revealed a steady progress, but the impact is not felt as the economy is still struggling with galloping inflationary pressure, rising unemployment rate, exchange rate volatility, surging debt profile amongst others.

According to the World Bank prediction, the economy was expected to grow by 1.8 percent in 2021 based on the projected recovery of crude oil prices and resumption of economic activities in the global market but the instability in the macroeconomic situation of the country coupled with the incessant insecurity situation in the country threatens the expected result.

The NBS statistics for 2021 fourth quarter also recorded a fall in GDP growth to 3.98 percent from 4.03 percent recorded in the third quarter of 2021. The data shows that the economy increased by 3.87 point when compared with 0.11 percent recorded in the fourth quarter of 2020 and contracted by 0.05 point when compared with 4.03 percent recorded in the preceding quarter of 2021.

The drop in the recorded growth rate in the third and fourth quarter revealed that the economy grew at a slower pace which is largely due to the base effects of the negative growth recorded in 2020 coupled with the macroeconomic and insecurity instability in the country.

MAN noted that this development called for consistent and collective effort to enact and implement policies that will improve economic activities across the productive sectors of the economy.

The advancement in output growth of the economy was supported by the rebounding of economic activities in the year; the relative peace witnessed in the economy; and the sustained high crude oil prices in the international market as well as marginal improvements in key macroeconomic rates such as lending and inflation rates.

The positive performance recorded in the manufacturing sector in year 2021 is attributed to the palliative measures imposed by Government to salvage the sector from the effect of Covid 19 pandemic.

Nevertheless, to improve and reposition the sector back as the engine of growth, the report stated that there is need to maintain those policies and formulate others that will encourage investments especially on the stability of exchange rate, development of local raw materials, protection of lives and properties among others.

The NBS Statistics for 2021 fourth quarter revealed that the non-oil sector output increased to 4.73 percent from 1.69 percent recorded in the corresponding quarter of 2020; thus indicating 3.04 point increase over the period.

However, the output declined by 0.71 point when compared with 5.44 recorded in the preceding quarter.

In the same vein, NBS recorded that the sector contributed 94.81 percent to GDP indicating an increase of 0.68 point when compared with 94.13 percent recorded in the fourth quarter of 2020, the contribution also recorded 2.3 point increase when compared to 92.51 percent recorded in the preceding quarter of 2021.

According to NBS report, the performance of the sector was mainly driven by Agriculture (Crop Production); trade; Information and Communication (Telecommunication); and Financial and Insurance (Financial Institutions).

The oil sector statistics according to the report, revealed an increase in the GDP growth rate to -8.06 percent in the fourth quarter of 2021 from -19.76 percent recorded in corresponding quarter of 2020; indicating an increase of 11.70 point over the period, it also depicts an increase of 2.67 point when compared with -10.73 percent recorded in the third quarter of 2021.

However, the sectors contribution to GDP dropped to 5.19 percent from 5.87 percent recorded in the corresponding quarter of 2020, indicating 0.68-point reduction over the period, the sector’s contribution also revealed 2.3-point increase when compared with 7.49 percent recorded in the third quarter of 2021.