Chaos in Nigeria as the Economy heads towards a recession
Nigeria’s central bank governors are meeting amid a gloomy financial outlook for Africa’s largest economy. Numbers released last week show the country’s economy contracting ( recession ). Economists blame a shortage of fuel, persistent power outages and a fall in the production of Nigeria’s top moneymaker, oil.
Nigeria is heading for a recession.
That’s what analysts say after the National Bureau of Statistics announced the economy contracted by about four-tenths of a percent in the first quarter of this year.
Africa economist at London-based Capital Economics John Asbhourne said a shortage of fuel and shortage of dollars to pay for imported goods stymied economic growth. He doesn’t expect the second quarter to be much better.
“It’s very, very likely the economy will shrink again this quarter, and then we’re in a recession,” said Asbhourne.
Oil is Nigeria’s top export and the primary funder of the government’s budget. The global drop in the price of crude has cut revenue and harmed the economy.
Also, oil production has dropped by a half-million barrels per day because militants blew up several key pipelines in the oil-producing Niger Delta region