Nigeria's economic crisis is getting worse.
On Friday the Nigerian Bureau of Statistics revealed
that the country's economy shrank by 0.4% year-
over-year in the first quarter — way worse than
expected.
Economists were expecting the country to grow by
1.8% year-over-year, according to the Bloomberg
consensus.
And now analysts aren't feeling too good about the
situation going forward.
"We have long warned of a slow-burning crisis in
Nigeria," Capital Economics' Africa economist John
Ashbourne said. "It now seems that this view was
too optimistic: the country is headed into a full-
blown economic crisis."
Nigeria continues to suffer from numerous
economic headaches, including lower oil prices
and the government's controversial foreign-
exchange and price-control policies (which
analysts have more or less deemed a failure ).
The biggest drop in growth was in Nigeria's
manufacturing sector, which Ashbourne wrote was
crushed by the country's FX policies.
"This is very bad news for Nigeria's government,
which has justified the current FX system as a
method of promoting non-oil industries," Ashbourne
said. "It is now clear that these policies have — as
we'd long argued — made a bad situation worse."
Still, the scariest thing about this latest gross-
domestic-product number is that it doesn't factor in
any of the debilitating problems Nigeria has seen in
the second quarter, including but not limited to the
fuel-shortage crisis and some of the oil-production
disruptions by the Niger Delta Avengers.
In short, Ashbourne concluded grimly, "the worst
is yet to come."
Source:
www.finance.yahoo.com/news/nigeria-headed-full-
blown-economic-001500943.html?
soc_src=mediacontentstory&soc_trk=tw
