Nigeria’s economy is bouncing back – thanks to its oil

Must Read

TAJBank Launches Nigeria’s 2nd Non-Interest Financial Institution (Photos)

Abuja Nigeria   December 2nd 2019, TAJBank, Nigeria’s second Non –Interest financial institution, has announced the launch of its services...

Buhari Appoints CBN Deputy Gov, Edward Adamu, As AMCON Chairman

President Muhammadu Buhari has appointed Mr Edward Adamu as Chairman of the Asset Management Corporation of Nigeria (AMCON). The appointment...

Here are the world’s most popular city destinations in 2019

Euromonitor International recently released the “Top 100 City Destinations 2019” ranking report, covering the world’s leading cities ranked by...
- Advertisement -
- Advertisement -

Nigeria’s president Muhammadu Buhari and his administration have spent much of the last two and half years since he came to office championing the idea that for Africa’s largest economy to have any hope of making meaningful progress it needs to diversify away from its reliance on oil.

But that day has not come. In fact, president Buhari will be relieved oil prices and local production have both picked up pace in the last few months because they have combined to help Nigeria record two consecutive quarters of economic growth for the first time since the end of 2015.

It might seem like a minor milestone, but after five straight quarters of the economy shrinking, it represents much more. Over the past year, Nigeria had been mired in its first recession in over two decades but latest data from Nigeria’s statistics bureau (NBS) shows that the country’s recovery, albeit slow, is on track. It recorded 1.4% growth in the third quarter.

Nigeria’s recession was triggered mainly by troubles in its oil sector. The fall in global oil prices coincided with a brief resumption of militancy in Nigeria’s oil-rich down south which caused oil production levels to fall to 20-year lows. As a result, Nigeria’s oil revenues fell sharply and, to stem the bleeding, the central bank set up currency controls to conserve its foreign reserves but that spawned a dollar shortage which hit local businesses hard.

Read:  States’ IGR Can’t Clear N7.33trn Debt In 7 years

As always, the turnaround in Nigeria’s economic fortunes is linked to its oil. In the third quarter of 2017, oil production has reached its highest point since the first quarter of 2016, NBS data shows. Nigeria’s president Buhari will certainly be hoping the growth streak continues. With only one full year left in office, Buhari has proposed a $23.9 billion record budget for 2018. But to fund it, Nigeria will have to step up it’s oil production even more as the budget is based on oil production of 2.3 million barrels per day—around 200,000 more than it currently produces.

Read:  States’ IGR Can’t Clear N7.33trn Debt In 7 years

Another way the government plans to shore up the deficit budget is through external borrowing. Its latest dollar Eurobond launch is looking to raise at least $2.5 billion and is reportedly on course to do so. It follows on the heels of a $1 billion Eurobond loan raised in February.

- Advertisement -

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest News

Airtel set to list on Malawi Stock Exchange

London and Lagos, 11 December 2019: Airtel Africa plc ("Airtel Africa" or "Group"), a leading provider of telecommunications and...

ASUU Strike, Naira Marley, what is xenophobia, Wizkid searches top the 2019 Google trending list

What were Nigerians searching for in 2019? Which singers were searched for the most this year? What was the top trending news moment...

Domestic Price of Turkey Increased By 38% to N1,800 per kg – Report

Turkey is a commodity best known for its seasonal consumption – Thanksgiving, Christmas and Easter. The estimated spend on the commodity in the US...

NSE Lifts Suspension Placed On Trading In The Shares Of FTN Cocoa Processors Plc

The Nigerian Stock Exchange (NSE) has lifted the suspension it placed on trading in the shares of FTN Cocoa Processors Plc. The NSE referred to its...

More Articles Like This