The Lagos Chamber of Commerce and industry (LCCI) has stated that the Nigerian economy maintained a positive growth trend in 2023, albeit at a slow pace.
The chamber however attributed the slowdown to weak performance in the oil sector.
Director General of the chamber, Dr Chinyere Almona, made the revelation in Lagos while presenting the Annual Report of the Chamber for 2023.
In her report, she noted that accompanying this low economic growth was the sharp increase in price levels largely driven by fuel subsidy removal, persistent depreciation of the naira and increases in food prices.
She noted that the Nigerian economy in 2023 was significantly influenced by global and domestic developments. “Some of the impacting global developments include Russia – Ukraine War, rising coups and coup attempts in Africa, Israel – Hamas War, elevated global inflation and sharp tightening of monetary policies, China’s slow economic recovery, global capital flight and overlapping shocks of the coronavirus pandemic.”
On local economic developments, she said tthe country experienced elections and election-related shocks including persistent inflationary pressures and very high monetary policy rates, foreign exchange crisis, high levels of fiscal debt and low GDP growth.
Almona noted that the slower pace of growth reflects the challenging economic conditions that have impeded productive activities.
On the business environment, the chamber noted that it witnessed some developments that either enabled the business environment or made it more challenging.
“The year saw the signing of the Electricity Act 2023 established to provide a comprehensive legal and institutional framework for a competitive electricity market, improve access to electricity, promote the use of renewable energy and the attraction of investments.
Also in the course of the year, the Data Protection Bill was signed into law.
“The Act establishes the Nigeria Data Protection Commission (NDPC) and empowers individual to seek redress in the event of data breach. The Act emphasises the fair, lawful and accountable processing of citizens personal data.
“The economy was also characterised by high operating cost influenced by deregulation of fuel prices and floating of the exchange rate. Other developments such as weak liquidity in the foreign currency market, uncertainty about the direction of the nation’s economic and fiscal policy, redesign of the country’s currency and heightened insecurity foretold serious challenges for the economy in 2023.
“Available statistics from the NBS show that the non-oil sector, comprising Finance & Insurance, Telecommunication, Utilities, Arts & Entertainment, Construction, Accommodation & Food Services, Administrative & Support Services, Professional Services, Public Administration, Real Estate, Trade, Agriculture and Manufacturing, which grew by 2.75 per cent, was the major driver of the positive growth recorded in the third quarter of 2023.
This rate was lower by 0.84 percentage points compared to the 3.58 per cent growth rate recorded in the second quarter of 2023. In real terms, the nonoil sector contributed 94.52 per cent to the nation’s GDP in Q3 2023, lower than the 94.66 per cent reported in Q2 2023. The oil sector, on the other hand, contracted by 0.85 per cent, indicating a significant improvement of 12.58 percentage points relative to the –13.43 per cent recorded in the previous quarter.
Citing the National Bureau of Statistics (NBS), the chamber noted that the Gross Domestic Product (GDP) grew by 2.54 per cent in the third quarter of 2023, slightly higher than the 2.51 per cent in the previous quarter. The growth rate is higher than 2.25 per cent recorded in the corresponding quarter of 2022. The slower pace of growth reflects the challenging economic conditions that have impeded productive activities.
SOURCE: THE SUN