MUST READ: Nigeria Faces Both Solar Eclipse and 'Economic Eclipse.'

Solar eclipses happen when the Moon moves between Sun and Earth, blocking the Sun's rays and casting a shadow on Earth. Today, 1st of September, 2016, in some parts of the country, the solar eclipse was witnessed.

However, while the solar eclipse is only momentary and doesn't have any negative effect as it were on the citizenry, more worrisome is what I have called economic eclipse that Nigeria is presently going through.

Economic recession may be defined as consecutive declines in quarterly real gross domestic product (inflation adjusted) and a decline in activity across the economy, lasting longer than a three to four months. It is visible in industrial production, employment, real income and wholesale-retail trade.

'Economy eclipse' in my opinion refers to a situation just like the solar eclipse where the nation is faced with economic shadows after economic activities and factors like the GDP etc, casts shadow on the Whole economy. What behoves us when this happen is darkness and uncertainty, and this to me is an 'economic Eclipse'
Unfortunately, unlike the solar eclipse, economic eclipses usually isn't momentary and its effect on the citizenry is often adverse. The duration of this event may last to several months or even years pending when the right things are done and put in place.

Key Pointers To An Economy Being In Eclipse
Below are some pointers of an economy being in recession according to Naija247news:

1) GDP Decline – Consecutive declines in quarterly real gross domestic product below zero. For example if the real GDP of Nigeria declined in Q1 2016 into the negative and also declines or remains in the negative territory in Q2, Nigeria is in a recession.

2) Decline in economic activity spread across the economy - in both the manufacturing and non-manufacturing sectors and lasting more than a few months. Production level, business activity, new orders, employment level and raw material inventories all decline at a faster rate.

3) Decline in income and profits reported by businesses – Another very good sign of a recession is when publicly quoted companies mostly declare a drop in their revenues or profits. In fact, most companies post massive losses during a recession.

4) Dip in Government Revenue – As explained, a dip in government revenue is also a very good sign that a country is sinking into recession. In Nigeria for example, we have seen government revenue dip so much that most states have to seek for a bailout to enable them pay for something as basic as salaries.

5) Job losses – There are massive layoffs as most companies cut cost to remain afloat. Since consumer and government spending has dropped, businesses can no longer produce at same level and therefore cut back to remain in business. The National Bureau of Statistics revealed a few months ago that over 528k jobs were lost

6) Inflation rate drops or gallops – Developed countries who experience a recession also record low inflation numbers. This occurs because both consumer spending and production drop simultaneously. However, in developing economies like Nigeria, reverse is the case. Because we mostly import, cost of goods and services sold locally increase forcing consumers to even spend less. In Nigeria, the drop in oil prices triggered capital outflows and then a loss in value of the Naira. This meant imported goods and services recorded a hike in prices. Nigeria’s inflation rate is currently 16.5, the highest since 2005.

7) Companies go bust – Another major sign of a recession is that companies in key sectors of the economy such as manufacturing, financial services and insurance typically go bankrupt. Industries that also rely heavily on government expenditure suffer from a recession.