Economy

At 1.5%, Nigeria’s 2018Q2 GDP Grows Slower, Hits N16.58tr

The National Bureau of Statistics (NBS), on Monday morning published Nigeria’s much awaited Gross Domestic Product (GDP) data for the second quarter of 2018, showing a 0.45% slower growth than the 1.95% recorded in Q1.
Specifically, the NBS said Nigeria’s economy grew by 1.5% (year-on-year) in real terms to N16.58tr, which was 0.72% higher than that of the corresponding period of 2017, just as real GDP growth was 2.94% on a quarter-on-quarter basis.
This followed the 3.95% negative growth Year-on-Year in the nation’s oil sector, while the non-oil sector climbed 2.05% in real terms. This represented 1.60% increase compared to the rate recorded for the same quarter in 2017, and 1.29% points over the first quarter of 2018.
In broad terms, the NBS explained that “growth in Q2 2018 was driven by developments in the non-oil sector as Services sector recorded its strongest positive growth since 2016. However, the relatively slower growth when compared to Q1 2018 and Q2 2017 could be attributed to developments in both the oil and non-oil sectors.”
The nation’s economic growth was less than the flat 2% growth envisaged by analysts surveyed by Bloomberg, even as aggregate GDP stood at N30.69tr in nominal terms. This represented a 7.85% increase when compared to N28.46tr of the preceding quarter and 13.57% rise, when compared to the N27.03tr in the 2017 corresponding quarter.
Average daily oil production for the period fell to 1.84m barrels per day, 8% lower than the 2mbpd average recorded in 2018Q1. Nigeria’s oil production level has so far not matched the 2.05mbpd achieved in 2016Q1, after which it had fallen to 1.61mbpd in the third quarter of that year. Oil production also represented a 1.6% drop from the 1.87 recorded in 2017Q2.
Real growth of Nigeria’s oil sector was –3.95% YoY in Q2 2018, “indicating a decrease by –7.48% points relative to the rate recorded in the corresponding quarter of 2017. Growth also decreased by –18.72% points when compared to Q1 2018. Quarter-on-Quarter, the oil sector recorded a growth rate of –8.34% in Q2 2018.
“The Oil sector contributed 8.55% to total real GDP in Q2 2018, down from figures recorded in the corresponding period of 2017 and the preceding quarter, where it contributed 9.04% and 9.61% respectively,” all of which occurred at the same time as crude oil price (Brent) maintained steady rise from $65.32 per barrel in January, reaching $76.98 in May, before falling slightly to $74.4 per barrel in June. The non-oil economy, NBS continued, was mainly driven by Information and communication services, Construction, Agriculture, Transportation and Storage and Other Services.
“In real terms, the Non-Oil sector contributed 91.45% to the nation’s GDP, compared to 90.96% recorded in Q2 2017 and 90.39% recorded in the preceding quarter.”
While services contributed 53.97% for the period; industries accounted for 23.18%; followed by agriculture with 22.86%, which was less than 22.93% in 2017Q2, but better than 21.65% in 2018Q1.
The agric sector crawled by just 1.19%, representing 1.82% decline from 3% in the prior quarter and 4.23% in the 2017Q4.

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