Despite the economic growth dipping to 2.51% in the second quarter of the year, experts anticipate that a combination of reforms in the real sector and an upturn in oil production volume will drive more robust growth in the second half of 2023. The predictions come as a response to the Q2 2023 GDP Report by the Nigerian Bureau of Statistics (NBS), revealing a 2.51% YoY growth in the Nigerian economy for the quarter.
According to Meristem Securities Limited’s equity report, the growth was largely fueled by improvements in the services sector, particularly telecommunications and information services, which contributed the highest GDP growth at 63% during the quarter.
Looking forward, analysts project that the latter half of 2023 will witness enhanced growth due to anticipated reforms in the real sector and an improved volume of oil production, surpassing the growth observed in the first half of the year.
A significant shift was also noted in the country’s Labor Force Survey. The NBS reported a decrease in the unemployment rate from 33.33% in Q4:2020 to 5.30% in Q4:2022 and further to 4.10% in Q1:2023. This change is attributed to the revised methodology aligned with International Labour Organization (ILO) guidelines, expanding the working-age population and revising the employment threshold.
In addition, the Central Bank of Nigeria (CBN) reported a decrease in Nigeria’s currency in circulation and currency outside banks in July 2023. This decrease, marking the first decline since the naira redesign policy earlier in the year, is linked to the CBN’s measures to manage liquidity and stabilize the naira, aimed at curbing inflation.
Opinion:
The forecasted anticipation of a growth surge in the second half of 2023, despite a recent economic slowdown, reflects the resilience and potential of Nigeria’s economy. The analysts’ insights highlight the importance of sectoral reforms and oil production in driving economic performance. Additionally, the recalibrated unemployment rate, aligning with international standards, demonstrates a more accurate representation of the labor market dynamics. The Central Bank’s efforts to manage currency circulation and liquidity underscore their commitment to maintaining economic stability. These combined efforts portray a proactive approach towards overcoming challenges and fostering sustainable growth, paving the way for a more promising economic trajectory.
Published by marketnewsng