“Tough times will soon be over,” President Buhari declared during his 2016 Workers Day address to Nigerians. These are tough times indeed for Africa’s largest economy. A quick scan through key economic indicators as highlighted in the table below show steep declines in GDP growth, oil production and revenues over the past 12 months, whereas inflation rates have risen by a whopping 4.5% in the same time period.
|May 2016||May 2015||Variance|
|GDP Growth Rate||-0.36%||3.96%||3.59%|
|NGN/USD Exchange Rate (Official)||197.00||197.00||–|
|NGN/USD Exchange Rate (Parallel)||350.00||220.50||129.50|
|Foreign Reserves ($bn)||27.1||29.6||(2.5)|
|Oil Production (Mb/day)||1.4||1.65||(0.25)|
The country’s over-dependence on oil has been chastised for decades and now with oil prices declining the nation cannot generate enough income to invest in new oil fields and other critical areas of the economy.
Unfortunately, the bad news does not end with the state of the economy. Nigeria is currently suffering serious socio-political challenges with the government constantly firefighting crisis situations in various corners of the country’s map.
Whilst President Buhari has been quick to engage key issues like corruption and the Boko Haram insurgency, other areas have been left to spiral out of control – from farmer-herdsmen clashes in the Middle-belt states, and Niger Delta militants attacks in the oil producing states and tomato crops annihilation by disease in the core Northern states.
Clearly, Nigeria cannot afford the same dismal performance in the next 12 months.
SBM Intel believes this the points raised in this report can serve as a useful feedback to the government and can inspire policy makers to make relevant adjustment and allocate necessary resources towards tackling areas of serious concern.
If the government is content for Nigeria to continuously be mentioned in the same breath as Cristina Kirchner’s Argentina and Venezuela then they may not like the feedback that will be given by Nigerians at the polls in May 2019.
- Editor’s note: a corrected version of the report was uploaded at 1238 WAT on 27 May, 2016, to remove formatting errors.