After months of abysmal performance, the Nigerian economy is showing a comeback sign. Latest data released by the Nigerian Bureau of Statistics (NBS), shows a 3.54% Gross Domestic Product (GDP) growth.
The growth was recorded year-on-year in real terms in the second quarter of the year, indicating improvement compared to the 3.11% growth recorded in the same period the previous year.
Per the NBS, the aggregate real GDP recorded was N17.29 trillion in the Q2, 2022, indicating a marginal decline of -0.37 compared to N17.35 trillion recorded in Q1 2022.
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Details of the data show Services leading other sectors, followed by the agricultural sector.
The services’ sector accounted for 57.35% of the GDP, followed by the agricultural sector with 23.24% contribution, about 1% increase compared to Q1 2022. Also, the industrial sector contributed 19.4%.
The significant increases which contributed to growth marks the seventh consecutive quarter of GDP growth, since the recession recorded in Q3 2020.
The oil sector dipped by 11.77% year-on-year in Q2 2022, compared to a contraction of 26.04% recorded in Q1 2022. The contraction in the sector’s GDP is following the decline in crude oil production capacity.
Nigeria recorded an average daily oil production of 1.43 million barrels per day (mbpd), lower than the daily average production of 1.61mbpd recorded in the same quarter of 2021 by 0.18 mbpd and lower than the first quarter 2022 production volume of 1.49 mbpd by 0.06mbpd.
The Oil sector contributed 6.33% to the total real GDP in Q2 2022, down from the figures recorded in the corresponding period of 2021 and the preceding quarter, where it contributed 7.42% and 6.63% respectively.
Non-oil sector
The non-oil sector grew by 4.77% in real terms during the reference quarter (Q2 2022). This rate was lower by 1.97% points compared to the rate recorded same quarter of 2021 and 1.31% points lower than the first quarter of 2022.
This sector was driven in the second quarter of 2022 mainly by Information and Communication (Telecommunication); Trade; Financial and Insurance (Financial Institutions); Transportation (Road Transport); Agriculture (Crop Production) and Manufacturing (Food, Beverage & Tobacco), accounting for positive GDP growth.
In real terms, the non-oil sector contributed 93.67% to the nation’s GDP in the second quarter of 2022, higher than the share recorded in the second quarter of 2021 which was 92.58% and higher than the first quarter of 2022 recorded as 93.37%.
Nigeria’s economy has been grappling with persistent headwinds buoyed mainly by shortfalls in oil revenue. This has resulted in inflation as forex scarcity took toll on the cost of goods and services, igniting concern that the country could relapse into another recession.
The GDP growth, though not high enough to erase the economic dips previously recorded, signifies progress that at least, always concern about another recession.