The year 2021 would be recorded in history as a memorable one for the current administration as it marked the first time in its tenure the country recorded its highest GDP (in real terms) since they resumed office which was in 2015. It coincidentally happened to represent the highest growth rate recorded in the last decade yet Nigerians are worse off than they were in 2015.
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Data from the National Bureau of Statistics (NBS) revealed that the country’s annual GDP (in real terms) stood at 3.40 percent as against the -1.92 percent recorded in 2020. This surpassed the International Monetary Fund’s October prediction by 0.8 percent as their predictions stood at 2.6 percent.
The Statistician-General of the Federation, Harry Simon disclosed that while the report was impressive, the impact of the base effect could not be ruled out as it played a significant role in achieving the current figures and that it was not time to celebrate and relax.
Emeka Ucheaga, the CEO of EUA Intelligence and a financial analyst at Credit Direct limited stated that the results were quite impressive as the results that came in outpaced most analysts’ predictions.
“It’s not a bad result. I was even predicting 3.2 percent, so it’s better than expected.
“The reality is that we are having a mean reversion as low base effect fades out.
“The data revealed that oil GDP shrunk again which is a big worry. Oil traded above $80 in Q4, so it’s funny how we are still shrinking even if volumes are not rising.
“Oil fell to an average of 200,000 barrels per day in 2021 but for it to still be declining at this pace is worrisome,” Ucheaga said.
“We expected a decline of 3.3% but the actual came in at 8%.
“Trade grew by 5%, half of what was obtainable in Q3, but that was a base effect influence once again,” he added.
While those antecedents look good in print, the realities tell an entirely different story. The post-pandemic realities of the average Nigerian have been submerged in a portfolio of heightened poverty, rising inflation, severe unemployment, unsettling insecurity, and harsh living conditions.
“Living in this economy isn’t funny anymore, it’s actually frustrating,” Ogechi Amobia, a businesswoman who resides in Abuja said.
“N10,000 means nothing for my family anymore. we cannot afford a 3-square meal on that amount.
“I took my family out to celebrate valentine and a cup of ice cream cost as much as N5,675 from a mall that previously sold it for N2,000. How ridiculous is that?
“Imagine when I’m pressured by my 3 kids to get a cup each for them, that cost me almost N17,000 for just ice cream.
“I deeply feel for those who earn below minimum wage its really saddening and it’s no longer funny,” she said.
Obinna Ahanogu, a professor at Covenant University stated that most states in Nigeria have not even begun implementing minimum wages of N30,000 in their constituents.
“I was listening to the radio yesterday, I just discovered a State like Kogi approved their N30,000 minimum wage; almost two years after governments approval.
“How then does this figure reflect this reality?
He further stated that one major metric for measuring GDP was production and the last quarter was lacking in that respect. “So how then did GDP grow?” he said.
“In the agricultural sector, 4th quarter is harvest time and we know what happened to our farming activities last year.
“A lot of farmers abandoned their farms due to terrorism, banditry, farmers and herders crisis, drought, flood amongst others.
“So, how did GDP grow?,” Ahanogu said.
Data culled from the NBS revealed that while the growth of the industry and service sector improved, growth in the agricultural sector, however, declined slightly from 2.17% in 2020 to 2.13% in 2021.
Obinna further emphasized the need for domestic production as this would be the country’s salvation from the storm that lies ahead.
“We can’t celebrate just yet until we have a sustainable source of production that generates significant revenue.
“If you look at the figures from the first quarter till the fourth quarter, you would observe a declining trend. Should we continue on this path of little or insignificant production we currently are in, this growth would not be sustainable,” he said.
The country’s original blueprint was earmarked on single-digit inflation and the Monetary Policy Committee (MPC) has been fighting tirelessly to return to the status quo which has been successful thus far even though at a very slow pace.
If the country is to maintain this significant growth threshold, then fighting inflation must be at the top of its ‘to-do list’.
Omobola Adu, a senior analyst at Afriinvest stated that the country’s current inflation rate is basically driven by the high level of insecurity in the food baskets of the country.
He stated that if these security challenges are tackled adequately and severely, then we just might have a shot at single-digit inflation in the medium term.
“There’s no way we can be talking about agricultural growth in Nigeria without talking about the fighting insurgency in the food baskets of the nation.
“They are both intertwined, if we neglect the security issues in these parts, then the prices of food commodities would continue record steady increases,” he said.
“And you know what they say about staple foods; ‘Once they are up, they never come down,” Omobola added.
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