Nigeria economy expands 4.03% in Q3 as non-oil sector sees sustained growth
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Nigeria, Africa’s most populous country and the continent’s largest economy by gross domestic product (GDP), saw its economy expand by 4.03 percent in the third quarter of the year, the fourth straight quarter of expansion, according to economic performance numbers released Thursday by the country’s National Bureau of Statistics (NBS).
Several economic analysts had expected this positive outcome for the quarter and it was helped by a sustained growth in non-oil sector activities to reach N18.54 trillion in real terms, a 4.03 percent year on year growth in the quarter; down against the 5.01 percent reported in the second quarter and but positively high against the 3.62 percent contraction in the corresponding quarter in 2020.
This NBS Q3 GDP report noted that the positive real growth is an indication of growth over the last four quarters since the recession witnessed in 2020 where output contracted by -6.10 percent and -3.62 percent, respectively, in Q2 and Q3 under the Covid pandemic.
Also, aggregate GDP, in the quarter under review, stood at N45.11 trillion in nominal terms. This performance is higher when compared to the third quarter of 2020, which recorded aggregate GDP of N39.09 trillion, indicating a year-on-year nominal growth rate of 15.41 percent.
Disaggregating the performance, the oil sector’s Q3 contraction stood at 10.73 percent year on year as against -12.65 percent year on year in Q2 of 2021. On the other hand, non-oil growth sustained its performance growing by 5.44 percent year on year in Q3 of 2021, as against the 6.74 percent year on year reported in the second quarter of 2021.
The rise in the non-oil sector was driven mainly by growth recorded in key sectors such as trade, information and communication (telecommunication); other drivers include, financial and insurance (financial institutions); manufacturing (food, beverage & tobacco); agriculture (crop production); and transportation and storage (road transport).
According to the report, during the third quarter of 2021, sectors such as mining and quarrying, which consists of crude petroleum and natural gas, coal mining, metal ore and quarrying and other minerals sub-activities, contracted nominally by 4.65 percent year on year; but in real terms, the sector’s contribution to real GDP in the quarter under review, stood at 7.66 percent, lower than 8.91 percent recorded in the corresponding quarter of 2020, and higher than the 7.58 percent recorded in the second quarter of 2021 respectively.
Agriculture, in real terms, grew by 1.22 percent year-on-year, showing a decrease of 0.17 percentage points from the corresponding period of 2020, and a decrease of 0.08 percentage points from the preceding quarter, which recorded a growth rate of 1.30 percent. It grew on a quarter-on-quarter basis at 39.83 percent.
However, the sector contributed 29.94 percent to overall GDP in real terms in Q3 2021, lower than its contribution in the third quarter of 2020, but higher than the second quarter of 2021, which stood at 30.77 percent and 23.78 percent, respectively.
The manufacturing sector, which comprises thirteen activities, reported a 4.29 percent year on year real GDP growth, higher than the same quarter of 2020 and higher than the preceding quarter by 5.80 percent points and 0.08 percent points, respectively. Real contribution of manufacturing to GDP in the third quarter of 2021 was 8.96 percent, higher than the 8.93 percent recorded in the third quarter of 2020 and higher than the 8.69 percent recorded in the second quarter of 2021.
Other sectors include, electricity, gas, steam and air conditioning supply sector, which contributed to real GDP in the third quarter of 2021 at 0.40 percent, higher than 0.36 percent recorded in Q3 2020. This figure in 2021 was lower than 0.80 percent recorded in Q2 2021.
Trade’s contribution to GDP was 14.93 percent, higher than the 13.88 percent it represented in the previous year, and lower than the 16.66 percent recorded in the 2021 second quarter. The contribution of the sector to real GDP in Q3 2021 was 0.20 percent, a rise from 0.18 percent recorded a year previously, and higher than 0.13 percent recorded in the second quarter of 2021.
Information and communication reported 14.20 percent contribution to real GDP in Q3 while real estate contributed 5.49 percent to real GDP in Q3 2021, lower than the 5.58 percent it recorded in the corresponding quarter of 2020; and then finance and insurance’s contribution to real GDP totalled 3.16 percent, higher than the contribution of 2.67 percent recorded in the third quarter of 2020 by 0.49 percentage points, and lower than 3.72 percent recorded in Q2 2021 by 0.56 percent points amongst other sectors.