Nigerian growth slows amid declining oil output

President Muhammadu Buhari, who was re-elected in February, has pledged to diversify his country's economy.

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    Gross domestic product in Africa's largest oil producer grew 1.94 percent in the three months through June [File: Jean Chung/Bloomberg]
    Gross domestic product in Africa's largest oil producer grew 1.94 percent in the three months through June [File: Jean Chung/Bloomberg]

    Nigeria's economic growth slowed in the second quarter as oil output declined slightly. 

    Gross domestic product in Africa's largest oil producer grew 1.94% in the three months through June from a year earlier, the Abuja-based National Bureau of Statistics said in a report published on its website Tuesday.

    That compared with a revised expansion of 2.1% in the first quarter and a median estimate of 2.46% in a Bloomberg survey of six economists.

    Key insights

    • After a few years of massive spending to boost the economy following a 2016 contraction, Nigeria's Senate approved a reduced budget for 2019 as the government struggles to meet revenue targets. The central bank has now stepped in two help support expansion, first with an interest-rate cut in March and thereafter by forcing leaders through regulations and penalties to give out more credit in an attempt to stimulate growth. 
    • President Muhammadu Buhari, who was re-elected in February, has pledged to diversify his country's economy, which depends on oil for 90% of its foreign exchange, making it vulnerable to global price movements. Crude output fell to 1.98 million barrels per day from 1.99 million barrels in the first quarter.
    • After averaging more than 7% in the first 14 years of this century, annual growth in Nigeria's economy, which vies with South Africa as the coninent's largest, hasn't manahed to top 3% for the past four years.

    - With assistance from Simbarashe Gumbo

    SOURCE: Bloomberg