By Tony Obiechina, ABUJA
Financial experts have lauded the nation’s positive economic performance in the last quarter of 2018. According to a report by the National Bureau of Statistics (NBS), the gross domestic product (GDP) recorded a growth of about 2.8 percent in the fourth quarter of 2018.
The growth in real terms (year-on-year) rose from about 1.81 percent in the previous quarter of the year, the report said.
The latest report coming few days to the forthcoming presidential election on Saturday, represents a 0.27 percent points increase when compared to the growth rate of 2.11 percent recorded in the fourth quarter of 2017.
The NBS report also showed a rise of about 0.55 percent points when compared with the growth rate in the third quarter of 2018, with real GDP growth on a quarterly basis of about 5.31 percent.
The implication of the fourth quarter growth performance is that real GDP grew at an annual growth rate of 1.93 percent in 2018, compared to 0.82 percent recorded in 2017, an increase of 1.09 percent points.
Analysts said the latest GDP figures are “positively surprising”, as most prediction never expected the performance to be beyond 2.0 percent average, considering the sluggish performance of the economy since exiting recession in 2017.
Commenting on the development, Prof, Uche Uwaleke, head of Banking & Finance department, Nasarawa State University, Keffi said it was a cheering news viewed against the fact that the expansion in national output was merely 1.5% in the second quarter of same year.
In a statement made available in Abuja on Wednesday, he said, “What is more, the traction in the economy was seen more in the non oil sector which recorded a modest improvement over that of the previous quarter. The picture is clearer when seen from a longer term perspective.
“GDP growth rate on an annual basis increased from 0.8% in 2017 to about 1.9% in 2018. This is good news. It is remarkable for an economy that exited five quarters of negative output growth in a row only a few months ago.
“This performance has a lot to do with the recovery in crude oil price and output, accretion to foreign reserves and the associated stability in the foreign exchange market”.
Uwaleke noted that the development “is also reflective of some of the policies and measures put in place by the government to stimulate the economy including the Anchor Borrower programme which has boosted the agric sector as well as other interventions by the CBN to ensure that credit is channeled to the real sector.
“It would appear also that the government’s investment in infrastructure especially power, rail and roads is beginning to yield fruits. It is evident from the recent GDP figure that the economy has returned to a path of positive growth. It is not yet Uhuru though. A GDP growth rate of 1.9% in 2018 is a far cry from the about 3% target projected in the 2018 budget.
“Also, it has not been a job-led growth considering that unemployment rate actually increased just about the same period, between Q3 2017 and Q3 2018, from 18.8% to 23.1% according to the National Bureau of Statistics.
“So, we need to begin to focus on inclusive growth. This is because GDP growth alone, although necessary, is not a sufficient condition for economic development. The challenge therefore is for the government to ensure that the GDP growth rate is not only above the annual population growth rate of about 3% on a sustainable basis, but that such growth is driven especially by the employment-elastic sectors of the economy such as manufacturing, ICT, construction etc as opposed to the oil sector which contributes less than 10% of GDP and employs less than 5% of the population.
“In other words, going forward, the government should intensify ongoing efforts at powering the economy through the Micro, Small and Medium Enterprises for inclusive growth”, he emphasized.
