The World Bank has said that the Nigerian economy has been on the downward slide since 1995 and continued till 2018.
This was stated in the World Bank’s latest report on the regional economy titled, ‘Africa’s Pulse’, released on the taxonomy of growth performance in sub-Saharan Africa, which focused on the macroeconomic and financial features that led to growth resilience in Africa.
The analysis, involved a series of macroeconomic variables for 44 sub-Saharan African countries from 1995 to 2018.
The world apex bank categorised growth performance into five groups: falling behind, slipping, stuck in the middle, improved, and established. The five groups were then reclassified into three groups: Top tercile, middle tercile and bottom tercile.
Following the classification carried out by the bank, the Nigerian economy was categorised alongside 18 other sub-Saharan African economies as slipping having recorded declined economic performance between 1995 and 2018.
“If a country’s economic performance declined from 1995–2008 to 2015–18, the country is categorised in the bottom tercile, which includes ‘falling behind’ and ‘slipping.’ If a country’s growth rate remained invariant over time, between 3.5 and 5.4 per cent in both periods, it is categorised in the middle tercile (or stuck in the middle). If a country’s economic performance improved from 1995–2008 to 2015–18, with the growth of more than 5.4 per cent per year, the country is categorised in the top tercile, which includes the ‘improved’ and ‘established’ groups.
“The bottom tercile consists of 19 countries: Angola, Burundi, Botswana, the Republic of Congo, the Comoros , Gabon, Equatorial Guinea, Liberia, Lesotho, Mauritania, Malawi, Namibia, Nigeria, Sierra Leone, Eswatini, Chad, South Africa, Zambia, and Zimbabwe. These countries did not show any progress in their economic performance from 1995–2008 to 2015–18. For instance, their median economic growth rate decelerated, from 5.4 per cent per year in 1995–2008 to 1.2 per cent per year in 2015–18.”
The bank states that the bottom performing economies, produce almost 60 per cent of the region’s total GDP, emphasising that the three largest countries in the region—Nigeria, South Africa, and Angola—and many commodity exporters are in this group.
Burkina Faso, Côte d’Ivoire, Ethiopia, Ghana, Guinea, Guinea-Bissau, Kenya, Mali, Rwanda, Senegal, and Tanzania made the top tercile.
The middle tercile countries are Benin, the Central African Republic, Cameroon, the Democratic Republic of Congo, Cabo Verde, The Gambia, Madagascar, Mozambique, Mauritius, Niger, Sudan, São Tomé and Príncipe, Togo, and Uganda.
The Bretton Wood institution equally cut Nigeria’s growth forecast by 0.1 per cent , stating “Growth in Nigeria is projected to rise from 1.9 per cent in 2018 to 2.1 per cent in 2019 (0.1 percentage point lower than last October’s forecast).
“This modest expansion reflects stagnant oil production, as regulatory uncertainty limits investment in the oil sector, while non-oil economic activity is held back by high inflation, policy distortions, and infrastructure constraints.
“Growth is projected to rise slightly to 2.2 per cent in 2020 and reach 2.4 per cent in 2021, as improving financing conditions help boost investment.
“In Nigeria, although the manufacturing and non-manufacturing PMIs
remained above the neutral 50-point mark—which denotes expansion—they
fell further in February, due to weaker rises in output and new sales
orders across firms.
“Household consumption in Nigeria has remained subdued, while multiple
exchange rates, foreign exchange restrictions, low private sector credit
growth, and infrastructure constraints have continued to weigh on
private investment.”
However, Isaac Okorafor, spokesperson for the Central Bank of Nigeria, said the CBN under the current governor, Godwin Emefiele, had shown so much ingenuity in managing the economy.
“You know the crisis that we have faced in the past three years. The bank has shown ingenuity in managing the situation and ensuring that everything is stable.”
