Recession In Nigeria Research Articles

Shocks in Consumption Pattern of Households to Economic Recession in Nigeria: A Case of Sanga Local Government Area of Kaduna State

Shocks in Consumption Pattern of Households to Economic Recession in Nigeria: A Case of Sanga Local Government Area of Kaduna State

Economic System of Islām as a Panacea to Economic Recession in Nigeria ‎

The National Bureau of statistics in July 2016 officially announced that Nigeria has entered into a recession, its first in 29 years. According to the data provided by the World Bank, the most recent time that the nation saw such a significant instance of economic downturn was while Ibrahim Babangida was in power. During that time period, the economy of Nigeria had a decline of 0.51% in the first quarter of 1987 and 0.82% in the second quarter of the same year. The disaggregation of the results for 2016 into its individual quarters revealed the sharpest decline, which was 2.4 percent, and a turning point after that. This is going by the manifestation of economic hardships experienced by the populace, even up to this moment. In point of fact, Nigeria's economy went from a level of economic buoyancy to a level of economic recession in the second quarter of 2016, and it has maintained negative growths in all quarters of that year up to 2017. This downward trend is expected to continue throughout 2017. In a bid to cushion the effect of this situation, the government in the short and medium terms took some measures (policies and reforms) to reverse the recession and put it on the path of growth reliance. In spite of these encouraging developments and despite the fact that it has been two years since the National Bureau of Statistics (NBS) officially declared that Nigeria had emerged from recession in its quarterly report on the country's Gross Domestic Product (GDP), the country's economic situation is still difficult, particularly with regard to the continued high cost of food. For a long-term solution, this paper, therefore, examines some measures of Islamic economic system, which is recession proof, due to the fact that it is basically premised on the fundamental sources of Islam, Sharī῾ah. The paper concludes that if these measures are taken into consideration by the government, it will not only lift the economy out of its current phase but will also guarantee a secure economy. The paper adopts analytical research methods, using majorly secondary data collection.

Reviving economic recession and the role of insurance companies in Nigeria

The persistent occurrence of poor economic condition and economic recession has put the policy makers on the possible and appropriate approaches to tackle the economic problem. Despite the efforts expended both empirically and theoretically to curb the menace, the economy is still vulnerable to macroeconomics shocks. Therefore, this study investigated the role of insurance companies on revival of reviving economic recession in Nigeria. The study covers the period of 25 years from 1996 to 2020 and data were gathered from CBN statistical bulletin, 2020 edition. Data on economic recession was represented with dummy variable such that “0” represents the period of positive economic growth rate while “1” represents the period of negative growth rate. Data on insurance investment, insurance asset, number of insurance companies and insurance contribution to GDP were considered to measure insurance performance. The model was specified with Ordinary Least Square and multiple regression methods. It was shown that insurance asset, insurance investment and insurance performance were found to statistically significant while numbers of insurance companies were found to statistically insignificant. The result revealed that insurance asset is not capable of reducing economic recession during the period under review but insurance investment, insurance performance and numbers of insurance companies have proven to be sufficient tools to reduce economic recession. Based on these findings, the study concluded that insurance companies played a significant role in reviving poor economic condition. The study recommended that adequate attention should be given to insurance companies in order to fulfill their full potential.

An Empirical Analysis of Nexus between Working Capital Management, Policy and the Corporate Profitability of Listed Non-financial Firms in Nigeria

The economic recession in Nigeria and the effect of COVID-19 on quoted companies has brought to fore the need for an effective working capital management. Managers need to understand the dynamics of investing, financing and managing of working capital in achieving business sustainability and maximization of shareholders’ wealth. It is against this backdrop that this study assessed the link between working capital management (WCM), working capital policy (WCP) and corporate profitability of listed non-financial firms in Nigeria. We used a sample of 109 Listed Non-financial Firms on the Nigeria Exchange Group from 2011 through 2020. The purpose of this paper is to establish a relationship that is statistically significant between profitability, Working Capital Management Policy and its components for listed firms in the NSE which was estimated by the static panel regression model computed in STATA 14 statistical software. The results of our research showed that there is statistical significance between profitability, measured through return on capital employed, and the components of working capital management (WCM): cash conversion cycle and working capital investment policy. Although, a negative and no statistical relationship is observed between profitability, measured through return on capital employed and working capital financial policy which is the proxy for working capital policy (WCP). Managers should take advantage of the effect observed by keeping CCC in a well-controlled and reasonable period as the level of impact achievable is based on management strategy. Furthermore, the study has shown that if firms invest more in current assets their profit will be significantly affected. Managers should however put into account the nature of their business and identify the optimal level that brings the highest return as the associated cost of holding current assets may outweigh the gain later.

Does Manufacturing Sector Output Significantly Predict Economic Growth in Nigeria?

The predictive power of the manufacturing output on growth is a topical issue, especially with the outbreak of the COVID-19 pandemic and its effects on global manufacturing and economic activities. As such, this study examines how Nigeria’s manufacturing output can be observed in estimating economic growth. The ARDL model and OLS technique were employed in our assessments, and quarterly data was sourced from the CBN statistical bulletin for 2019 and the NBS annual report from 2010Q1 to 2020Q4. The study finds that manufacturing output positively and significantly affects growth in Nigeria and therefore can significantly predict further economic growth and, by extension, recession in Nigeria. It also recommends the need to improve the ease of doing business and security, adjusting interest rates for manufacturers, stabilize the exchange rate, develop infrastructure, and increase interventions in the manufacturing sector in Nigeria.

The Impact of Economic Recession on Tender Rates of Building Projects in Nigeria

The recent economic recession in Nigeria affected all sectors of the economy. This paper aims to determine the factors that affect tender rates of building projects, determine the impact of economic recession on the components of tender rate compare the tender rates before and during the economic recession and identify the contractors’ mitigation strategies. The study was conducted using a trend survey design. It was discovered that economic imbalance contributed majorly to the increase in tender rates as a result of an increase in material cost and labour cost, the average percentage increase of the constituents of tender rate such as the cost of building material during the recession is 18.79% from 0.80% before the recession, cost of labour is 14.45% from 3.33%, cost of hiring plants is 14.00% from 4.63% and the total average percentage increase of tender rate before the recession was 2.92% and during the recession is 14.90.

Can the Yield Curve Predict Economic Growth Performance? Empirical Evidence from Nigeria

The paper investigates the capability of the yield curve to predict future economic activity in Nigeria, especially before, during and after the 2016/2017 economic recession. Using quarterly data on the index of industrial production (as a proxy for economic growth) and yield spread, we generated regression results for various data samples including the era of the global financial crisis- GFC (2007-2009); pre-economic recession in Nigeria (2010-2015) and economic recession / slow recovery (2016-2019).Though the model behaved differently before, during and after the 2016/2017 economic recession, general results indicated the substantial predictive power of the yield spread in providing a good forecast of the level of economic activity up to four quarters into the future. The paper therefore, strongly demonstrated the influence of yield spreads in predicting the future level of Nigeria’s economic activity. Keywords: Yield curve, economic growth, recession, forecast, Nigeria. DOI: 10.7176/RJFA/12-10-05 Publication date: May 31 st 2021

Analysis of Profitability Performance of Dangote Sugar Refineries PLC: During and After Recent Economic Recession in Nigeria (2013–2018)

Private sectors have contributed immensely to the development of Nigerian economy without a doubt. However, the Nigerian economy is volatile over the period years till date, which causes it to plug into recession in 2016. Many questions have been raised on the performances of business in the economy especially during economic recession and when economy is sound. Moreover, the investors needs more decision making tools to assist them on decisions to invest in Nigeria. Against this backdrop, this research aimed to analysis the profitability performance of Dangote Sugar Refineries plc during and after recent economic recession in Nigeria (2013-2018). This research make use of simple profitability ratios: Net Profit Margin, Return on Assets (ROA), Returns on Equity (ROE) ratios, and trend analysis was also used to analyze and established trends in the profitability performance of Dangote Sugar Refineries plc during and after recent economic recession in Nigeria for the periods under review. The research revealed that, the Dangote Sugar Refineries plc performs better after economic recession than when the economy is recessed, as the Net Profit Margin, Return on Assets (ROA), Returns on Equity (ROE) ratios improved after 2016, during recession. It was recommended that, the investors should invest in businesses when economy is sound. We also recommended to the management to ensures that the operating expenses of the business should not increases with same proportion to increases in sales, and increases in equity should be invested on assets that will increases production and productivity, thus, increases revenue and improves profitability performances

Impact of International Remittances on Unemployment in Nigeria

Despite the implementation of stabilization measures during the present recession in Nigeria, unemployment has assumed an alarming dimension and a crisis proportion with millions of able-bodied persons who are to accept jobs at the prevailing wage rate but are unable to find placements. Unemployment can be reduced in developing countries through developmental projects but this can be achieved due to lack of finance. Sequel to that, remittance inflow serves as finance for investment purposes. This study focuses on the impact of international migrant remittances on unemployment rate in Nigeria bearing in mind that reducing the rate of unemployment is one of the macroeconomic objectives of every country. An unemployment rate model was formulated and the unit root test was first applied to the data set. The time series were stationary and the two-stage least squares (2SLS) method was used to identify the impact of remittances on unemployment rate in Nigeria. Findings reveal that international remittances affect unemployment negatively and there exists a unidirectional causality between international migrant remittances and unemployment without feedback. The study recommends that the government and other stakeholder should map out programmes that will sensitize majority of the Nigerian populace on the benefit of investing remittance money so as to become entrepreneurs, create job opportunities and become employers of labour. Keywords: International remittances, Private Investment, Unemployment, Two Stage Least Squares. DOI: 10.7176/JESD/12-1-05 Publication date: January 31 st 2021

Managing university degree programmes acceditation in the era of economic recession in Nigeria

The economic recession experienced in Nigeria between 2015/2017 was a great concern to the management of the university system especially with shortfall in the prices of oil and gas in the global market. It would not be an understatement to say that, Nigeria university degree programmes accreditation would suffer because funding of these programmes comes from oil and gas revenue due to Nigeria mono-economy. It is evidently glaring that managing programmes accreditation during this dispensation would be affected in no small measure due to the economic recession. In view of the above, this paper would examine the following: the concept of university management, university programmes, programmes accreditation, objectives of accreditation, accreditation instrument, criteria for programme accreditation, challenges of accreditation, sources of funding university degree programmes, economic recession and its effect on university management, recommendations and conclusion.

A Regime Switching Skew-Normal Model of Contagion in Major African Stock Markets

This study was carried out to examine the contagion and structural break for some selected African stock markets namely: Nigeria, Ghana, South Africa (SA), Tunisia, and the US stock market. To achieve this, two periods were considered, that is the crisis period, 31st December, 2013 to 31st December, 2017 and the non-crisis period, 1st January, 2018 to 31st December, 2019. The choice of these periods was to reflect the structural break caused by economic recession in Nigeria during the crisis period. The expectation is that there is capital flight from Nigerian equities to safety in the selected emerging economies in Africa and in the US economy. Following the work of Chan et al (2018), the study used Regime Switching Skew-Normal (RSSN, henceforth) model which is capable of measuring contagion and structural breaks between markets and across crisis and non-crisis periods. The RSSN model was estimated using Bayesian method. The study finds the existence of moderate contagion between Nigeria and SA and the absence of contagion with the rest of the economies, suggesting there is capital flight from equities in Nigeria to SA for safety during the 2016 economic recession. Also, the study confirms the presence of structural break between crisis and non-crisis periods as the probability of average return declines during crisis period. The absence of contagion among African stock markets suggests there is no significant economic cooperation and cross-border portfolio investment flow among the countries. This development further underpins the imperative of the full implementation of African Continental Free Trade Area (AfCFTA), which is to encourage economic activities and investment flow on the continent.

English

The interest to carry out volatility analysis of crude oil production in Nigeria in this paper is motivated by the shortfalls in quantities of crude oil produced in recent past, given the country’s high dependence on oil and its contribution to the nation’s economic development. In 2016 precisely, the country experienced drastic instability in prices of crude oil at international markets and dwindling production quantities due to vandalism on oil facilities and other corrupt practices in the sector. This paper aims at using volatility measures to investigate variability of crude oil production as an assumed contributor to the economic downturn observed in the recent past in Nigeria. The data used are crude oil production data in millions of barrels collected from NNPC Statistical Bulletin. Variance of the crude oil series has been fitted with ARCH (2) model. ARCH (3) and GARCH (3,3) models are also fitted to the variance of the error obtained from ARIMA(0,1,1). ARCH and GARCH models have shown evidence of volatility in the series. The parameter estimate of the non-linear component of the bilinear model fitted to the crude oil data could not capture volatility clustering. This explains the superiority of ARCH and GARCH model over bilinear model when fitting volatile series. Synonymous with oil price volatility, evidence has it that crude oil production data are volatile. Although, Nigerian government’s intervention and negotiations with Niger Delta Militants to end operational attacks on oil facilities yielded positive results, fact has been established that the two economic variables (production and price) are volatile, as contributors to the recent past economic recession in Nigeria. It is important for the stakeholders in the sector and Nigerian government to always exhibit proactive measures against illicit activities that negatively affect oil production at all times and ensure maximum control of crude oil production process and militating factors during price shocks to avoid uncontrollable economic instability. Key words: Crude oil, volatility, ARIMA Model, ARCH, GARCH, BARIMA Model.

Qualitative and Functional Teacher Education: a Viable Tool for Mitigating Economic Recession in Nigeria

Qualitative and Functional Teacher Education: a Viable Tool for Mitigating Economic Recession in Nigeria

Analysis of Profitability Performance of Dangote Sugar Refineries Plc : During and after Recent Economic Recession in Nigeria (2013 - 2018)

Analysis of Profitability Performance of Dangote Sugar Refineries Plc : During and after Recent Economic Recession in Nigeria (2013 - 2018)

Recession and the Challenge of Sustainable Economic Growth in Nigeria: An Evaluation of Macroeconomic Policies


 The recent economic recession in Nigeria was manifested shortly after the successful democratic-to-democratic transmission of political power in 2015, against the backdrop of continental and global economy rankings of the country as the largest in Africa, and 24th in the world as at 2014. Based on relevant variables of datasets from 1981 to 2016, this paper employed error correction mechanism on log-linear regression model to evaluate macroeconomic policies being implemented to stabilise and restorethe economy on the path of sustainable growth. The variables were surrogates of fiscal, monetary, exchange rate and supply-side policies. The results showed that the respective macroeconomic policies had mixed effects, but jointly had significant growth-retarding effect on the country’s economy. Therefore, the paper concludes that macroeconomic policies had heterogeneous effects, and emphasised the need for appropriate mix of macroeconomic policies to be implemented to sustain and move theeconomy out of the recession trap.
 JEL Codes: C22, C52, E52, E62 and F31

Time series analysis of economic growth rate series in Nigeria: structural breaks, non-linearities and reasons behind the recent recession

ABSTRACTThis article deals with the modelling of growth rate time series in Nigeria with a view of detecting its statistical properties, structural breaks and non-linearities. We employ both fractional integration and structural break time series techniques in modelling the annual growth rate series of the Nigerian GDP growth rate for about 55 years. The data span between 1960 and 2017. The results show that Nigerian growth rate is unstable with non-linearities and long-range dependence structures. We also investigate what might explain these features and conclude that erratic political institutions, associated with poor economic management and insecurity in Nigeria, among others, in the decades after independence are the root causes of non-linearities observed, which have also led to the subsequent recent economic recession in Nigeria.

Commercialisation of Tertiary Education as a Correlate of Economic Recession in Nigeria

This study examined commercialisation of tertiary education as a correlate of economic recession in Nigeria. The study adopted a correlational survey design. The Taro Yamane’s formula was employed to draw the sample of 322 lecturers from the purposively chosen two federal universities using the convenience sampling technique. Data collecting instrument was the researcher’s structured questionnaire that was face validated by three experts. Data were analysed using the Pearsons’ correlation coefficient and linear regression. Findings revealed among others very high relationship between commercialization of tertiary education and economic recession in Nigeria. Based on the findings, some recommendations were made among which was the intensification of quality assurance mechanisms of the tertiary education system by the various commissions responsible for the programme to ensure quality manpower. Keywords: Commercialisation, tertiary education, economic, economic recession, Nigeria DOI : 10.7176/JEP/10-2-17

Do Government Revenues Matter for Economic Growth? Evidence from Nigeria

The bursting of crude oil prices in the international market since mid-2014 has resulted in dwindling oil revenue, which has led to economic recession in Nigeria. The recession has further exacerbated existing socioeconomic problems bedeviling the country. In the light of this, we examined the effect of government revenues (oil and non-oil revenues) on economic growth, both in the short-run and the long-run using autoregressive distributed lag method. Our findings show that government revenues are indispensable to economic growth in Nigeria. In addition, we found that economic growth is more responsive to oil revenue than non-oil revenue. Based on our findings, we advocate for effective and efficient use of government revenues. Furthermore, since oil revenue fluctuates more than non-oil revenue, we further advocate for creation of an enabling business environment geared towards improving the contribution of the non-oil sector to the government revenue base.

SWOT analysis of indigenous and foreign contractors in a developing economy

PurposeThe call for more engagement of local contractors has been gaining support by construction stakeholders especially as a result of the recent economy recession in Nigeria. However, due to the increasing complexity of the construction industry and technological advancement, the influx and engagement of foreign contractors has been on the increase and their contribution is also germane to the economy development of the country. In view of this, the purpose of this paper is to examine the strengths, weaknesses, opportunities and threats of indigenous and foreign contractors in the country with a view to understanding their differences in the quest of improving their service delivery.Design/methodology/approachA case study research was carried out through the use of interview and questionnaire administered on management staff and professionals in selected construction firms, respectively. In order to obtain a balance view of the subject, professionals from construction consultancy firms selected through Delphi method were also included in the study and sampled accordingly. Appropriate statistical tools were employed in analysing the data gathered and result was presented with the aid of a SWOT template.FindingsFindings of the research show that foreign contractors have better strengths than their indigenous counterparts, and this has made them gain better expertise. Also, they enjoyed more opportunities than the threats they are faced with, but the reverse is the case for indigenous contractors.Originality/valueThere is a need for the two categories of contractors to identify their SWOT as indicated in this study and leverage their strengths, correct their weaknesses, capitalise on golden opportunities and avoid potentially devastating threats to enhance their effectiveness and success in the industry.

Ponzi Schemes: An Analysis on Coping with Economic Recession in Nigeria

The proliferation of Ponzi schemes in Nigeria appear to coincide with the official declaration of economic recession in early 2016. It is therefore pertinent to empirically investigate the nexus between the recession and Ponzi schemes in the country. Anchored theoretically on Robert Merton’s Strain Theory the study was guided by two research objectives and one hypothesis. The snow-balling sampling technique was used to select 135 Ponzi scheme participants from Rivers, Bayelsa and Anambra States. Descriptive analysis of the results was undertaken in tables, charts and graphs. The findings revealed amongst others that MMM, Ultimate cycler, Givers Forum, Get Help World Wide were the major Ponzi schemes in Nigeria. It was also found that Ponzi schemes are a coping strategy for economic recession. The paper posits that until the economic downturn is adequately addressed and the economy revamped, Ponzi schemes would continue to thrive in Nigeria. It recommended economic revitalisation through effective economic diversification policies that will enhance provision of socio-economic livelihood as palliatives to recession induced strain.