A former presidential candidate, Chief Martin Onovo, has faulted the National Bureau of Statistics (NBS) for coming up with a verdict that Nigeria is out of recession. Onovo, who contested the 2015 presidential elections on the platform of the National Conscience Party, said that Nigeria was in a season of stagnation, rather than being in a recession.
The outspoken opposition chief told newsmen in Lagos on Monday that Nigeria’s situation in 2016 was complicated by high unemployment and high inflation. On Sept. 5, the NBS announced that Nigeria’s economy was out of recession with the Gross Domestic Product (GDP) of Africa’s most populous nation returning to positive growth.
According to the NBS, Nigeria’s GDP grew by 0.55 per cent in real terms in the second quarter of this year. The bureau said that Nigeria’s GDP shrank by 0.52 per cent, year-on-year, in real terms in the first quarter of 2017, representing the fifth consecutive quarter of contraction since the first quarter of 2016.
Onovo, however, argued that: “The first thing is that the NBS misrepresented the situation. Nigeria actually entered into recession in June 2016 but it wasn’t simply a recession, after Dec. 2016, Nigeria entered into stagnation. A recession is when you have a decline in your GDP for two quarters, if that decline continues, it becomes a depression. Now, if it is complicated by high unemployment and high inflation then that is stagnation. So, it is not correct to say that Nigeria exited a recession because Nigeria was not just in a simple recession, Nigeria was in stagnation. Secondly, the growth they reported is 0.55per cent; can we call 0.55 per cent a growth? Is it beyond the zero margin in the GDP estimates, the right word to use for that 0.55 per cent increase in GDP is that the economy is stagnant, which justifies the stagnation. NBS has misrepresented the fact by saying that the country exited a recession. If the country exits recession and there is growth, that growth will show both in GDP growth, in increase in employment and then, inflation will reduce.’’
According to him, that is why the people are complaining that they cannot see the effect because the level of education is low and a lot of people do not even understand the concept. Onovo explained that stagnation was a period when a country’s economy was not growing and it was complicated by high unemployment and high inflation.