Nigeria GDP Fell Further by 0.16% Points in Q2 2019

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T he Nigerian Gross Domestic Product growth have experienced further decline by -0.16 percent from the first quarter growth. This is according to the report released by the National Bureau of Statistics on Tuesday.

The Q2 2019 Gross Domestic Product (GDP) grew by 1.94%(year-on-year) in real terms. This represent an increase of 0.44% points when compared to the second quarter of 2018, which recorded a growth of 1.50%. This is however a decline of –0.16% points when compared to the 2.10% (revised from 2.01% due to oil output revisions) growth recorded in the first quarter of 2019.

In nominal terms, aggregate GDP stood at N34,944,151.61 million during the quarter, an increase of 13.83% over the performance in the second quarter of 2018 and 9.8% over the preceding quarter.

The NBS averred that the performance observed in Q2 2019 follows an equally strong first quarter performance, and was likely aided by stability in oil output as well as the successful political transition.

On a half year basis, real growth in the first half of 2019 stood at 2.02%, higher than that of the first half of 2018 which was 1.69%. Quarter on quarter, real GDP increased by 2.85% compared to a decline of –13.69% in the preceding period

Overall, a total of 15 activities grew faster in Q2 2019 relative to last year, while 13 activities had higher growth rates relative to the preceding quarter.

The oil sector posted a real growth rate of 5.15% (year-on-year) in Q2 2019, representing a 9.10% points increase relative to the rate recorded in the corresponding quarter of 2018. It also indicates an increase of 6.61% points when compared to Q1 2019(revised). Quarter-on-Quarter, the oil sector recorded a growth rate of –1.55% in Q2 2019.

The sector contributed 8.82% to total real GDP in Q2 2019, up from levels recorded in the corresponding period of 2018 but down compared to the preceding quarter,

The non-oil sector’s growth on the other hand declined in the quarter under review. The sector grew by 1.64% representing  –0.40% points lower than the growth recorded in the same quarter of 2018, and -0.83% point lower than the first quarter of 2019. During the quarter, the sector was driven mainly by Information and communication, Mining and Quarrying, Agriculture, Transportation and Storage, as well as Other Services. In real terms, the Non-Oil sector contributed 91.18% to the nation’s GDP, lower than the share recorded in the second quarter of 2018 (91.45%) but higher than the first quarter of 2019 (90.78%).

Many businesses are operated through a separate entity such as a corporation or a partnership (either formed with or without limited liability). Most legal jurisdictions allow people to organize such an entity by filing certain charter documents with the relevant Secretary of State or equivalent, and complying with certain other ongoing obligations. The relationships and legal rights of shareholders, limited partners, or members are governed partly by the charter documents and partly by the law of the jurisdiction where the entity is organized.

The Agricultural Sector which contributed 22.82% to total GDP in real terms saw a decline in growth but a marginal increase in contribution from the previous quarter. The sector grew by 1.79% (year-on-year) in real terms, an increase of 0.60% points from the corresponding period of 2018, but a decline of –1.38% points from Q1 2019 which recorded a growth rate of 3.17%. However, its contribution to total GDP in real terms, fell compared to 22.8% in Q2 2018 but rose compared to 21.89% Q1 2019

Manufacturing sector contracted by -0.13% in Q2 2019 from 0.81% in Q1 2019 and 2.35% in Q4 2018  –0.13% (year on year)

In our outlook for the remaining quarters of 2019, we expressed uncertainty regarding growth of the nations GDP. We sited a mix of factors that pointed to possible continuous slow growth. This factors include late passage and possible poor performance of the budget being occasioned by crude oil price crawling in the international market. Fiscal spending have been restrictive following pre election, elections and the long wait for the Federal Cabinet. This created a probable uncertainty within the real sector.

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