Nigeria’s economy sunk deeper into recession after its Gross Domestic Product (GDP) contracted for the third straight quarter of this year by 2.24 percent, according to data released by the National Bureau of Statistics (NBS) on Monday.
The dip follows a 2.06 percent decrease in the year’s second quarter as inflation hit an 11-year high of 18.3 percent last month, driven by an acute dollar shortage that has drastically hit the West African nation’s capacity to import.
“During the quarter, aggregate GDP stood at N26.6 trillion (in nominal terms) at basic prices, compared to the third quarter 2015 value of N24.3 trillion. Nominal GDP grew by 9.23 percent. This growth was higher relative to growth recorded in the third quarter of 2015 by 3.22 percent points,” the NBS report read.
Crude oil exports, which are the country’s biggest source of revenue, accounting for about 70 percent of foreign earnings also fell to an average production of 1.63 million barrels per day (bpd), a 0.87 percent dip from 1.69 bpd in the second quarter, added the report.
Militant attacks in the oil-rich Niger Delta region have severely hit Africa’s biggest oil producer.
Two major militant groups in the region, Niger Delta Avengers and Niger Delta Greenland Justice Mandate blew up gas plants and oil pipelines in efforts to gain independence for the region, pushing the country’s oil production to the lowest in 20 years, Market Realist.com reported.
The non-oil sector driven by agriculture however, grew by 0.03 percent, a major boost after successive negative growth rates in the past two quarters.
Market analysts project Africa’s second-biggest economy to grow by 2.5 percent next year, if it can increase its battered oil production to 2.2 million bpd, Reuters reported.
Nigeria slumped into recession in August, after a 2.06 percent contraction in the first half of the year, following the continued fall in global oil prices since 2014.
Several firms have closed operations in the nation while others have undertaken massive lay-offs due to the dollar crunch that hit the importation capacity and payment of salaries, while the naira hit a record low of 412 to the dollar in August.
Erisco Foods Limited, a tomato paste manufacturer shut down its plant in Lagos last month, while several international airways may cut flights to the nation, after United Airlines of the US and Iberia OF Spain suspended their flights in May, Bloomberg reported.
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