Dear Subscriber,

In the last 12 months, the Federal Government has taken bold steps to stimulate economic activity and restore growth through the ERGP.

The 2017 growth numbers of 0.8% is evidence of a slow but consistent path to recovery. After an extended period of negative growth, the non-oil sector appears to have bucked the trend. The sector expanded by 0.47% in 2017, driven by labour-intensive industries such as Agriculture and Transport. We expect these developments to have a positive impact on the labour market in the short term.

One of the key objectives of the ERGP is the anticipated increase in investment flows into Nigeria. However, the latest Capital Importation Report shows that whilst FPI (hot money) spiked 304% to $7.3bn, the more stable FDI actually declined by 5.3% to $981mn.

This should be a source of concern to policy makers and the managers of the external reserves. An increase in US interest rates next quarter could trigger a reversal of capital flows with significant downside risks for Nigeria.

In this edition of the Bi-monthly Publication, the FDC Think Tank dissects these issues into bite sizes, and projects the short term trajectory for economic activity.

Enjoy your read.