FG: Nigeria’ll Not Enter Recession

FG: Nigeria’ll Not Enter Recession     

 
The Federal Government, in its Medium-Term Expen-diture Framework (MTEF) and Fiscal Strategy Paper (Revised), submitted to the Senate by President Umaru Musa Yar’Adua for approval, has indicated that although, the rate of economic growth in Nigeria is projected to decline next year,  the nation would not enter economic recession due to government’s fiscal and monetary policies.
The covering letter to the MTEF dated September 29, 2009, was read on the floor of the Senate last Wednesday, by the Senate President, Senator David Mark.The document, prepared by the Budget Office of the Federation, indicated that “fiscal policy for 2011 to 2012 has been formulated in a difficult macro-economic setting, with economic growth forecasted to slow to just 2.61 per cent in 2010 and inflation currently above its long term trend.
“The government has, therefore, had to carefully balance the potential benefits of an expansionary fiscal policy on aggregate demand and short term economic growth, against the negative effects such a policy might have on inflation, macroeconomic stability and long term economic growth.” the report said. The MTEF and Fiscal Strategy Paper noted that “headline inflation is forecasted to decline in the medium term, due to decreased aggregate demand and  successful implementation of policies to control inflation by the Central Bank of Nigeria (CBN).
According to the report: “The Naira to US dollar exchange rate is forecasted to stabilise at 147, over the medium term, with the upward pressure on the exchange rate caused by a projected increase in the price of oil, negating the downward pressure caused by the high rate of inflation in Nigeria, relative to the USA.“The rate of economic growth in Nigeria is projected to decline in 2010, due to a fall in aggregate demand caused by the global recession.
However, due to government's fiscal and monetary policies, Nigeria will not enter recession and the rate of economic growth is expected to increase in 2011 and 2012.” The document noted: “government plans to increase thebenchmark price of oil from  $45 in 2009 to  $50 in 2010; this will result in a substantial increase in budgeted oil revenue from N969 billion to N1,184 billion between 2009 and 2010, despite a forecasted decline in oil production.
“There is a further increase in oil revenue in 2011 to N1,396 billion due to an increase in the benchmark price of oil to  $52.5 and increased oil production. Further increases in the benchmark price and oil production drive an increase in oil revenue from N1,396 billion in 2011 to N1,566 billionin 2012. “The benchmark price for oil is forecasted to be below theprojected market price for oil in 2010 of $57.20; this means that as long as there are no unexpected shortfalls in oil production or non-oil revenue, savings should accrue to the ECA in 2010.“Non-oil revenue in 2010 is forecasted to decline from its 2009 budgeted amount and there are two reasons for this decline. 
“Firstly, non-oil revenue collection targets in 2009 were set at an ambitious level and may not be met.“Secondly, non-oil revenue may decline due to the slowdown in economic growth caused by the global downturn. Total Federal Government revenue is forecasted to decline from N2,265 billion in 2009 to N2,096 billion in 2010; with the decrease in non-oil revenue outweighing the increase in oilrevenue.”


http://www.thisdayonline.com/nview.php?id=156826


Are these politicians for real,in my book,Nigeria has been in recession for so many years now,going by the definition of recession:

Definitions of Economic recession on the Web:

In economics, a recession is a general slowdown in economic activity over a sustained period of time, or a business cycle contraction.
en.wikipedia.org/wiki/Economic_recession

A slowdown in economic activity marked by less consumer spending and often also by higher unemployment.
www.mariner.org/chesapeakebay/century/vocab.html

A temporary slow-down in economic growth
www.think-energy.co.uk/ThinkEnergy/16-18/glossary/Default.aspx

A decline in economic activity (GDP) that persists for at least two quarters


So nairalanders after going through the above,do you think Nigeria is in recession already or you're going with the FG's position that Nigeria is not

wrong analysis @post,
in truth naija hasn't been in recession, going by our books,

but rather the level of corruption and looting has made what was supposed to filter down to the masses,
filtered to thier own pockets.

I am always saddened by all this govt analysis. did they even know what their citizens are passing thru by the day?
Naija has bn in recession since 1985 when IBB came into governance.They better keep their mouth shut if they have nothing sensible to soothe this pains.

 

Dont Mind them ooooo, NIGERIA HAS ALWAYS BEEN IN RECESSION, Before the global meltdown started, or how do you explain, a comatose education, tourism,security,power, health,banking and transportation sector.

We have been in recession since the 90s.

Its obvious that am a better Political Economist than most of this economic planners in naija.

You are wrong- it is because the people abroad, who ship things to Nigeria do not have enough money anymore, because of the recession in the country they live- not because of the recession in Nigeria - how can the level of import to a country dictate how vibrant that country is?

Problem is, politicians in Nigeria and other citizens are usually on different pages. Did you listen to the President's independent day broadcast? Did you hear all the growth figures he was quoting?

Prof Sam Aluko once chided these decievers when they told us that the Global Economic Recession will not affect Nigeria, he said that the recession has always been with us. When will they stop playing on our inteligence?

I honestly agree with you, Nigeria is in a situation called Corruprecession which can be defined as an artificial hyper recession caused by Mismanagement and Corruption. Don't you guys get it, Simply keep electricity constant for one week and then note its effect in our economy.,and the redistribution of income that will follow but no, why? because the rich and bad guys in Aso rock and beyond will lose revenue is light happens to be stable, and so many more, but kindly understand that Nigeria has potentials of enormous expansion If and only If the Infrastructure can be made available.
My 2 Kobo

I wonder myself what the country is going through now;they like to deceive themselves;these criminals in government.

We all know the dont have integrity so they can say anything,just to make themselves look as though they are working;what have they done to make Nigeria a better country?

They should please hold their peace.

nigeria actually witnessed an oil boom after the civil war.

you might want the reduce the font by the way. we get what you are saying already.

@bawolomo  Abi?

Very true and very scary


Need I say more

 

You are so wrong my dear. Yes we know the politicians are just reading another baseless manifesto but this analysis is wrong.