Reports show that before 2016, the Nigerian economy was growing. This means that the country was producing more goods and services than the corresponding period a year ago. Then the economy went into recession, i.e. goods and services produced in the country reduced.
This can be attributed to certain factors. There is the devaluation of the Naira, Nigeria’s financial currency. Around May, 2016, the Naira was devalued to 290 per dollar. Previously it stood at around 200 per dollar.
A similar factor that affected the growth of production of goods and services in the country is difficulty in obtaining foreign currency. This affected the bringing in of machineries and spare parts into the country and this affected the production of goods and services. Many business men could not import goods. Some companies folded up.
Also many State governments could not pay the salaries of their workers who could not purchase the things they needed. Hence more goods and services could not be produced.
At this backdrop, one can take a critical look at the recent announcement by the Nigerian Bureau of Statistics, N.B.S., that Nigeria has exited recession.
The increase in G.D.P., the Gross Domestic Product, is said to be 0.55%. At this the government deserves commendation for it shows that its various economic policies put in place are yielding positive dividends.
However the minimal growth rate shows that much still needs to be done. Obviously, the Nigerian population is growing at a rate of more than 0.55%. Although there are no official census figures, sources are putting the population at around 160 million and growing at a rate of about 2.5 percent.
To meet the needs of a population growing at 2.5%, the economic growth rate should increase by at least 4 times its present rate of 0.55%.
Other factors that have affected the production of goods and services include increase in the price of fuel as well as decrease in both the production and price of crude oil, Nigeria’s main source of foreign currency.
Inflation is still high. If the country produces significant amount of goods and services, the price of commodities will be affordable by Nigerians.
Since the present administration came into power, the prices of many goods and services have risen by up to 200%. But how many people have had their income increase by this amount? It is obvious that more people have slided below the poverty level.
They cannot afford nutritious food for their bodies neither can they afford hospital bills. What is awaiting this category of people if not the spread of diseases and death?
Recession is by no means a welcome trend. Meagre production of goods and services shows that more people cannot afford regular and nourishing food, medical supplies, housing and clothing and many other needs and wants.
Also the government cannot provide good roads, electricity and many other facilities.
The good people of Nigeria should work assiduously to help the less to do among it’s citizenry. The government and those who are well to do should teem together to help the masses.
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