Africa’s largest economy is nowhere close to getting out of its recession

Go slow.
Go slow.
Image: Reuters/Akintunde Akinleye
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Nigeria’s first recession in decades is not abating. Data from Nigeria’s National Bureau of Statistics shows the economy contracted in the third quarter, just as it did in the two preceding quarters.

Much of Nigeria’s problem comes down to a slump in the price of its main export, oil, and, by extension, government revenues. The trouble has been exacerbated by erratic currency policy—ranging from adopting a fixed exchange rate to cracking down on bureau de change operators—in response to plummeting foreign reserves. Rather than generating the desired effect, the policies have mostly worsened the crisis.

Nigeria’s tanking economy is compounded by spiking inflation, which recently reached an 11-year high, creating a stagflation environment. The timing couldn’t be any worse for Nigerians, with prices for goods inching up in the ever-busy festive season.