The World Bank has admitted Nigeria moved out of last year’s recession faster than expected. The bank, in its newly released Africa’s Pulse report, admitted that the real GDP in West and Central Africa was estimated to have contracted by 1.1 per cent in 2020, less than projected in the October 2020 Africa’s Pulse forecast, partly owing to a less severe contraction than expected in Nigeria in the second half of the year.
The report further explained that, “Following a 6.1 per cent year-on-year contraction in 2020Q2, Nigeria’s economy contracted by 3.6 per cent in 2020Q3, and expanded by 0.1 per cent in 2020Q4, moving out of recession faster than expected.
Nigeria slipped into a recession in the second quarter of 2020 amid the economic fallout of the COVID-19 pandemic but emerged from it in the fourth quarter.
For the year, Nigeria’s real GDP is estimated to have contracted by 1.8 per cent, a stronger out-turn than projected in the October 2020 forecast.
The Bretton Woods institution noted that Nigeria’s oil sector weakened in the fourth quarter of 2020 despite an increase in oil prices.
Partly due to OPEC+ quotas, oil production fell from 1.67 million barrels a day in 2020 Q3 to 1.56 million barrels a day in 2020 Q4, leading to a sharp fall in oil GDP, which was, however, offset by a rebound in the non-oil sector.
Additionally, the agriculture sector, which represents about a quarter of the economy, registered a growth of 3.4 per cent year-on-year in 2020 Q4. The recovery in sectors hit hardest by containment measures —including retail trade, transport, and hospitality, continued in 2020 Q4, boosting the economy’s recovery.