The Nigerian economy continued its positive trajectory in the second quarter of 2024, registering a robust growth rate of 3.19% in GDP. This marks a significant improvement compared to the 2.51% recorded in the same period last year and the 2.98% growth in the first quarter of this year.
The National Bureau of Statistics (NBS) attributed the impressive performance to the strong showing of the Services sector, which contributed 58.76% to the total GDP and expanded by 3.79%. This sector has been a key driver of the economy in recent years, demonstrating resilience and adaptability.
While the Agriculture sector experienced a slight slowdown, growing by 1.41% compared to 1.50% in the previous quarter, the Industry sector staged a remarkable recovery, posting a 3.53% growth after contracting by 1.94% in Q2 2023.
Composition of the GDP
The composition of the GDP also shifted in favor of the Industry and Services sectors during the second quarter. Both sectors increased their contributions to the aggregate growth rate compared to the same period in 2023. This indicates a structural shift in the economy, with a growing emphasis on non-oil sectors.
In terms of nominal terms, the aggregate GDP at basic price reached N60.93 trillion in Q2 2024, up from N52.10 trillion in Q2 2023. This represents a year-on-year nominal growth of 16.94%. The real GDP value stood at N18.29 trillion, slightly higher than the N18.28 trillion recorded in Q1.
Oil Sector Performance
The oil sector, while contributing to the overall growth, saw a mixed performance. Average daily oil production declined to 1.41 million barrels per day in Q2 2024, compared to 1.57 mbpd in Q1 and 1.22 mbpd in Q2 2023.
However, the real growth of the oil sector was 10.15% year-on-year, indicating a substantial improvement compared to the previous year. The sector contributed 5.70% to the total real GDP in Q2 2024, up from the figure recorded in the corresponding period of 2023 but down from the preceding quarter.
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Non-Oil Sector Drives Growth
The non-oil sector, accounting for 94.30% of the nation’s GDP in Q2 2024, was the primary driver of growth. This sector expanded by 2.80% in real terms, driven by key industries such as Financial and Insurance, Information and Communication, Agriculture, Trade, and Manufacturing.
While the non-oil sector’s contribution to the growth rate slightly decreased compared to Q2 2023, it remains a crucial pillar of the Nigerian economy.
If You Ask Me
The strong GDP growth in Q2 2024 is a positive sign for Nigeria’s economy. However, several challenges remain, including persistent inflation, security concerns, and infrastructure bottlenecks.
The government will need to continue implementing policies that promote economic diversification, improve infrastructure, and address social issues to ensure sustainable and inclusive growth in the long term.
