On Saturday, Govt. data released from Nigeria’s National Office of Statistics had revealed that the Africa’s largest economy by size had dipped into a recession this year as the beleaguered African country had reported a contraction in Gross Domestic Product for the second consecutive quarter, reflecting a rancorous fiscal impact of the pandemic alongside a withering hit stemmed off the multi-year low crude oil futures’ prices with sheer uncertainties over demand outlook.
Notably, the African continent’s top crude oil exporter, Nigeria, had witnessed its last recession back in the 2016, however, it emerged into growth in the following year. Nevertheless, it could have been an entirely different narrative this year amid conflicting market projections, while growth outlook remained feeble and the resource-rich country seemed to have borne one of the weightiest brunt from the pandemic outbreak.
More importantly, the pandemic-battered nation relied on crude oil exports for more than 90 per cent of its FX earning which had compounded its economic landscape further, since the global crude oil market had been facing off a deluge of demand crunch, while a likely supply glut as early as by next year could have torpedoed crude oil futures’ prices further.
Nigeria slips into recessed territory as oil sector contracted by the most
Apart from that, Saturday’s data had also revealed that the heavily oil-dependent nation’s fossil fuel sector had contracted by 13.89 per cent over the third quarter of the year, compared to a growth of 6.49 per cent in the same time a year earlier, while the country’s non-oil sectors had been telescoped by 2.51 per cent on fiscal Q3, 2020 that ended on September 30.
Meanwhile, addressing to a calamitous economic outlook breathing fires over the Africa’s largest economy by size, the Statistician General Yemi Kale tweeted on Saturday, “Q3 2020 Real GDP contracted for second consecutive quarter by -3.62%. Cumulative GDP for the first 9 months of 2020 therefore stood at -2.48%”.