Nigeria’s ascent to assume the mantle of Africa’s leading economy is one of the more impressive emerging market growth stories of recent times. But, in common with many of the country’s peers, this trajectory has been volatile, characterised by surging highs and challenging lows. The past two years have been no exception, as lower oil prices have hit the economy hard. Today, Nigeria is dealing with several vexing problems, including a dollar liquidity crunch and growing insecurity in the oil-producing Niger Delta.
In July, inflation hit an 11-year high of 17.1%, while second-quarter growth figures revealed that the economy had entered into a recession for the first time in more than 20 years. These difficulties are having a material impact on the wellbeing of a population that is increasing more quickly than gross domestic product (GDP) growth, which is projected to contract by about 1.8% this year.