Service Sector Boosts Economy To 3.19% Growth In Q2

Nigeria’s economy experienced a boost, with the Gross Domestic Product (GDP) growing by 3.19 per cent year-on-year in the second quarter of 2024.

This growth, reported by the National Bureau of Statistics (NBS), was primarily driven by the services sector, which expanded by 3.79 per cent and contributed nearly 59 per cent to the GDP.

In contrast, the agriculture sector saw a slight decline to 1.41 per cent, while the industry sector rebounded with a growth of 3.53 per cent from a previous decline.

Overall, the nominal GDP reached N60.93 trillion, marking a 16.94 per cent increase from the previous year.

The GDP grew by 3.19 per cent (year-on-year) in real terms in the second quarter of 2024. This growth rate is higher than the 2.51 per cent recorded in the second quarter of 2023 and higher than the first quarter of 2024 growth of 2.98 per cent.

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In the quarter under review, aggregate GDP at basic price stood at N60.93 trillion in nominal terms. The performance is higher when compared to the second quarter of 2023 which recorded aggregate GDP of N52.103 trillion, indicating a year-on-year nominal growth of 16.94 percent, the National Bureau of Statistics (NBS) said in a new data that was released yesterday. If adjusted for inflation, the real GDP is N18.29 trillion in the second quarter.

The Nigerian economy has been classified broadly into the oil and non-oil sectors

The performance of the GDP in the second quarter of 2024 was driven mainly by the services sector, which recorded a growth of 3.79 per cent and contributed 58.76 per cent to the aggregate GDP. The agriculture sector grew by 1.41 per cent, from the growth of 1.50 per cent recorded in the second quarter of 2023.

The growth of the industry sector was 3.53 per cent, an improvement from -1.94 per cent recorded in the second quarter of 2023. In terms of share of the GDP, the industry and services sectors contributed more to the aggregate GDP in the second quarter of 2024 compared to the corresponding quarter of 2023.

The real growth of the oil sector was 10.15 percent (year-on-year) in Q2 2024, indicating an increase of 23.58 per cent relative to the rate recorded in the corresponding quarter of 2023 (-13.43 per cent). Growth increased by 4.45 per cent points when compared to Q1 2024 which was 5.70 per cent.

On a quarter-on-quarter basis, the oil sector recorded a growth rate of -10.51 per cent in Q2 2024. The oil sector contributed 5.70 percent to the total real GDP in Q2 2024, up from the figure recorded in the corresponding period of 2023 and down from the preceding quarter, where it contributed 5.34 per cent and 6.38 per cent respectively.

The non-oil sector grew by 2.80 per cent in real terms during the reference quarter (Q2 2024). The rate was lower by 0.78 percentage points compared to the rate recorded in the same quarter of 2023 which was 3.58 per cent and relatively same with the 2.80 per cent recorded in the first quarter of 2024.

This sector was driven in the second quarter of 2024 mainly by Financial and Insurance (Financial Institutions); information and communication (telecommunications); agriculture (crop production); trade; and Manufacturing (food, beverage, and tobacco), accounting for positive GDP growth.

The agricultural sector grew by 2.86 per cent year-on-year in nominal terms in Q2 2024, showing a decrease of 8.57 per cent points from the same quarter of 2023. Looking at the preceding quarter’s growth rate of 0.77 per cent, there was an increase of 2.09 per cent points.