Impressive performance from Agric, trade and construction drive non-oil sector growth
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But the rate of real Gross Domestic Product (GDP) growth is expected to slow further to 4.6 percent because of the political unrest in the Niger Delta region which has stunted oil production output.
These are the findings and forecasts by the Economic Intelligence Unit (EIU) United Kingdom on Nigerian the economy for the year 2008 and 2009 based on year 2007 economic performance.
In the Country report, the EIU noted that although Nigeria’s economic growth has been robust in recent years but its impact on reducing poverty has been far less than the headline figures suggest.
“This is because of heavy dependence on the oil and gas sector, which has few linkages to the rest of the economy and tends not to create significant new employment.”
EIU is of the view that this year 2008, a sharp rise in oil production, led by offshore fields, in particular Chevron’s Agbami field, should see growth of Nigeria’s real GDP rebound strongly to 7.5 percent, especially if the President Umaru Musa Yar’Adua led administration can at least partly resolve the problems in the Niger Delta.
“Growth will moderate in 2009, although a continued rise in offshore oil production should enable real GDP to expand by 6.5percent,” said EIU.
On Nigeria’s external sector, EIU noted that the country traditionally runs a trade surplus, which is partly offset by a deficit on the invisible accounts. Trends in these components, the Intelligence Unit said, drive any changes in the overall current account.
“The traditional surplus on the current transfers account is expected to be maintained in 2008 and 2009, reflecting large inflows of private transfers from Nigerians in the Diaspora.”
The income account, by contrast according to EIU is always firmly in deficit as a result of profit remittances, notably from oil companies.
Further more, EIU stated: “Even allowing for a rapid rise in import, high service payments, rising income debits and potential disruptions in oil supply stemming from political problems in the Niger Delta, we expect both the trade balance and the current to remain firmly in surplus as oil prices remain high as production starts to rise.”
These are the findings and forecasts by the Economic Intelligence Unit (EIU) United Kingdom on Nigerian the economy for the year 2008 and 2009 based on year 2007 economic performance.
In the Country report, the EIU noted that although Nigeria’s economic growth has been robust in recent years but its impact on reducing poverty has been far less than the headline figures suggest.
“This is because of heavy dependence on the oil and gas sector, which has few linkages to the rest of the economy and tends not to create significant new employment.”
EIU is of the view that this year 2008, a sharp rise in oil production, led by offshore fields, in particular Chevron’s Agbami field, should see growth of Nigeria’s real GDP rebound strongly to 7.5 percent, especially if the President Umaru Musa Yar’Adua led administration can at least partly resolve the problems in the Niger Delta.
“Growth will moderate in 2009, although a continued rise in offshore oil production should enable real GDP to expand by 6.5percent,” said EIU.
On Nigeria’s external sector, EIU noted that the country traditionally runs a trade surplus, which is partly offset by a deficit on the invisible accounts. Trends in these components, the Intelligence Unit said, drive any changes in the overall current account.
“The traditional surplus on the current transfers account is expected to be maintained in 2008 and 2009, reflecting large inflows of private transfers from Nigerians in the Diaspora.”
The income account, by contrast according to EIU is always firmly in deficit as a result of profit remittances, notably from oil companies.
Further more, EIU stated: “Even allowing for a rapid rise in import, high service payments, rising income debits and potential disruptions in oil supply stemming from political problems in the Niger Delta, we expect both the trade balance and the current to remain firmly in surplus as oil prices remain high as production starts to rise.”
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