According to a United Kingdom financial analysis organisation, World Economics, Nigeria is on its way out of recession, as April Sales Managers’ Index (SMI) data suggested that the “Nigerian economy is continuing to grow out of the recession which saw 10 months of consecutive contraction in 2016.”
The International Monetary Fund (IMF) had predicted last October that the economy would grow by 0.6 per cent in 2017, although other analysts predicted a growth of about two per cent.
IMF’s World Economic Outlook report, which was released in October, predicted that the economy would not only exit recession in 2017, but that real Gross Domestic Product (GDP) is expected to increase marginally by 0.6 per cent with Consumer Prices rising by 17.1 per cent.
According to World Economics, the Market Growth Index grew to 58.5 in April as the monthly Sales Growth Index ticked up to 56.7, its highest value since 2015 and representative of rapid growth.
Price inflation for April, tracked by the Prices Charged Index, remained high at 58.7 – indicative of high levels of inflation, however, a slowing trend has developed for the past nine months, it says.
Panelists have explained that although conditions remained difficult for businesses, they were adapting to the challenges and the recent changes to the naira’s forex rate were aiding sales transactions.
Overall, conditions in Nigeria have improved further over the past month and managers are expressing renewed optimism that the economy will continue to grow and regain strength after the recession.
In the report released on Tuesday, the organisation, however, cautioned it was too early to know if the changes were built on a solid foundation.