With less than 12 months to the end date of the Economic Recovery and Growth Plan (ERGP), the macroeconomic performance scorecard is showing mixed results. The Ministry of Budget & Planning must be commended for the conceptualization of the plan. The gap analysis shows superior performance in some areas but also reveals significant gaps in others, which could result in growth hindrances in the near term. The most disturbing gaps are the negative variance on GDP growth (-5.1%) and unemployment (-11.87%).
In spite of the import substitution and protection strategies of the FGN, rice smuggling is still a thriving business. A demand gap of about three million metric tonnes, still looms due to poor mechanization amongst other factors. Solutions proffered include input subsidies such as low cost fertilizer and high yielding seeds.
The China/US trade war seems to be ebbing after a market reeling initial impact. China has responded to US tariffs by raising its tariffs on $60 billion worth of US goods, starting June 1. This came after president Trump increased tariffs to 25% on $200 billion of Chinese goods. Now it seems that tough talking is giving way to sober reasoning. These two countries however, are Nigeria’s major trading partners and the trade war could have a devastating impact on the domestic economy if it materializes.
In this edition of the FDC Monthly publication, the FDC Think-Tank analyses these issues and their implications on businesses and the economy at large.
Enjoy your read.