Nigeria’s GDP sustained growth for nine months after exiting recession in 2020
Nigeria’s GDP backpedaled in the fourth quarter of 2022, slowing to 3.5% from 3.9% a year earlier.
According to the National Bureau of Statistics, NBS, which released the report on Thursday, the subdued growth was on the back of devastating flooding which destroyed farms and declined oil production amid rising costs for manufacturers.
Main growth drivers
The performance of Nigeria’s GDP in Q4’22 was driven mainly by the Services sector, which recorded a growth of 5.69% and contributed 56.27% to the aggregate GDP.
However, this is the first negative since the economy exited a recession in 2020.
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The NBS said full-year growth stood at 3.1% in 2022, in line with the World Bank’s projection.
“Although the agriculture sector grew … its performance was significantly hampered by severe incidences of flood experienced across the country,” the NBS said.
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“The Industry sector was … challenged recording -0.94% growth and contributing less to the aggregate GDP relative to the third quarter of 2022 and the fourth quarter of 2021.”
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The price of diesel, which many businesses rely on to generate electricity, has soared in Nigeria due to high global oil prices, leading to increased costs of production, while a weaker currency has made imports more expensive.
Nigeria, Africa’s top oil producer, recorded an average daily oil output of 1.34 million barrels per day (mbpd) in the fourth quarter, lower than the daily average of 1.50 mbpd registered in the same quarter of 2021, the NBS said.
Oil production, which accounts for around two-thirds of government revenue and 90% of its foreign exchange reserves, contracted 13.38% year-on-year in the fourth quarter, the NBS said.