The 2022 fiscal year has passed the midpoint, and it has been a rollercoaster on many fronts for most Nigerians, from political intrigues to heightened insecurity, the rising cost of living, and the seemingly unending fuel scarcity.
Outside of the happenings within Nigeria’s borders, unforeseen occurrences like the war between Russia and Ukraine continue to have global effects, and Nigeria is not excluded.
So how did Nigeria’s economy fare in the face of all these?
3.1% GDP Performance
Nigeria recorded a 3.11% GDP growth in the first quarter of 2022 over that of 2021. In the first quarter of 2021, the real growth rate was 0.51% as the country pulled out of the recession caused by COVID-19.
However, after ending the 2021 fiscal year at a 3.4% overall growth rate, the first quarter of 2022 with a 3.11% growth rate is a 0.29% decrease to the overall growth rate figure.
The growth recorded in the first quarter was heavily influenced by the service sector, which contributed 56.17% of the total output. The agricultural sector contributed 22.36% and the industrial sector 21.47%.
Rising Inflation
The prices of goods and services, headline inflation have been on the increase since the start of the year. Inflation figures started out the year at 15.6% in January and rose over the months to 17.7% by May 2022.
The rising inflation has created untold hardship for Nigerians, and it is estimated that if inflation continues to rise, an additional 7 million people will be pushed into poverty by the end of the year.
Already, citizens are spending more to put food on the table. as even everyday meals are now beyond reach for average Nigerians.
Stock Market
The stock market performance has been on a rollercoaster ride, with upward and downward swings.
Market capitalization, which is the value of a company on the floor of the stock exchange, started the year at N23.63 trillion by the end of the first week of January. This value, arrived at by multiplying the total number of shares sold in a period by the share price, rose steadily to N25.5 trillion by the last week of February.
In March it went from N25 to N26 trillion, then fell in April before shooting up to hit an N29.16 trillion peak by the end of May. It then started falling and closed out in the month of June at N27.87 trillion.
The all-share index, which tracks the performance of securities, had a more stable sail over the period. The all-share index rose gradually from 43,845.42 in the first week in January to 47,202.3 in the first week in February. Thereafter, it maintained an almost uniform index, increasing or decreasing marginally till the third week of April. It rose over the next four weeks before falling slightly in the first week of June.
N3.3 Trillion Disbursed in Five Months
The Federation Account Allocation Committee (FAAC) has disbursed N3.306 trillion in the first five months of the year. January disbursement was the highest disbursement within the period when the sum of N699.82 billion was shared among the three tiers of government.
In February, the amount shared dropped to N574.7 billion, which also was the month with the least amount shared so far this year.
N695.03 billion was shared in March and N656.6 billion in April. May FAAC sharing saw the three tiers of government splitting the sum of N680.78 amongst themselves.
Price of Crude Oil Averaged $111.43/Barrel
The last selling price of crude oil at the international market averaged $111.43 per barrel. This is 79.7% above the government-approved budgeted estimate of $62 per barrel.
In the first week of January, crude oil was sold at $80.07 per barrel, the lowest crude price. Crude oil prices continued to increase over the period and peaked at $139.41 per barrel in March.
Despite the fluctuation of the selling price of crude, it never fell below $80 per barrel. By the end of June, it sold for $114.78 per barrel, then increased to $120.31 per barrel at the beginning of July.
Nigeria’s “ball and chain” subsidy regime has made it near impossible for the country to benefit from the rise in crude prices. The subsidy bill started out at N3 trillion at the beginning of the year but as crude prices and fuel prices have gone up, the subsidy bill might go as high as N9 trillion in 2022.
While data on some other key indicators like unemployment and poverty are not available, the economic performance of some indicators is commendable.
Activities in the stock market show earning estimates are up and the company’s earnings are up.
The selling price of crude being above the government estimate means more revenue to the government to finance its budget.
However, the rising prices of goods and services obviously put a burden on the people as the cost-of-living shoots up.
As we progress into the second half of the year, will these indicators perform better to improve the overall well-being of the people?