August 27, 2024/InvestmentOne Report
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- According to the latest Gross Domestic Product (GDP) report released by the National Bureau of Statistics (NBS), the Nigerian economy demonstrated a solid performance in Q2:2024, growing by 3.19% YoY in real terms, up from 2.51% in Q2:2023 and slightly higher than the 2.98% recorded in Q1:2024.
- The oil sector saw a remarkable improvement, recording a real growth rate of 10.15% YoY in Q2:2024, a substantial increase from the -13.43% YoY contraction in Q2:2023 and also a significant increase from the previous quarter s growth of 5.70% YoY. The average daily oil production was 1.41 million barrels per day (MMbpd), an increase from 1.22 MMbpd in Q2:2023 but lower than the 1.57 MMbpd recorded in Q1:2024. In line with these developments, the oil sector’s contribution to real GDP slightly decreased to 5.70% from 6.38% in the preceding quarter.
- Elsewhere, the non-oil sector continued to be the backbone of the Nigerian economy, growing by 2.80% in real terms in Q2:2024. This was driven by strong performances in sectors such as Financial Institutions, Telecommunications, Agriculture (particularly Crop Production), Trade, and Manufacturing (notably Food, Beverage, and Tobacco). The non-oil sector contributed a substantial 94.30% to the nation’s GDP, reflecting its critical role in the economy.
- Looking ahead, we expect the growth trajectory to remain upwards in the Nigerian economy. The continuous efforts to boost oil production, coupled with continued growth in the non-oil sectors, particularly in services and agriculture, is expected to support further GDP growth. However, challenges such as ongoing security issues in key agricultural regions, and potential external economic shocks could pose risks.
