Leading Abuja based Development Economist and economy analyst, Mr. Odilim Enwegbara, has reacted to the use of data from just one quarter by the National Bureau of Statistics (NBS) to declare Nigeria is out of recession.
In an interview, he queried the indices used by NBS to justify the country’s exit from the recession, stressing that “an average man has not got a job and those working have not got their salaries.”
According to him, “I don’t agree in principle that we have exited recession. To come out of recession, you need two consecutive growths in GDP; just the same way you have two consecutive negative growths to slip into recession”.
“There are two types of growth, which the economy can witness: vertical and horizontal economic growth in combination. When you have a vertical economic growth, the economy can be growing without trickling down, without real growth.
Continuing, Enwegbara averred that “If the growth is a vertical growth, it has a multiplier effect without a trickle-down effect. But if it is a horizontal growth, it is a more inclusive growth because we have both trickle-down and multiplier effects”.
“So I don’t know the type of growth we have or what has generated the growth. Is it improvement in power? Is it improvement in infrastructure? Is it real sector growth that has driven the economy? Is it financial speculation? Is it possible that we have borrowed money to inject into the economy so that we are witnessing a growth? Is it inflation-driven growth? You may have a growth but inflation can eat up the whole growth,” Enwegbara argued.
Business Hilights recalls that the Statistician General and chief executive of NBS, Dr Yemi Kale, had due to the rising discordant voices since the release of the data penultimate Tuesday, said “There are different stages Nigeria must go through before the masses will feel the effects of going out of recession. Out of recession is the first step which is very important.
Then the country can talk of economic recovery, which is going back to where Nigeria was before the recession. Recession is just a technical word; we are comparing 2017 and 2016.
According to him, “Recession is not about the price of your goods, not whether unemployment is going up or down; not whether you have quality education; it is purely your gross domestic product; your output of goods and services in the economy.”