As WTO rates Nigeria’s average GDP growth rate since 2014
By Charles Ebi
In the second quarter of 2024, Nigeria grew its Gross Domestic Product ,GDP, by 3.19% on a year-on-year basis in real terms from the 2.51% posted in the same period of last year, and higher than the 2.98% achieved in the first quarter of this year.
This information was revealed by the National Bureau of Statistics ,NBS, in its Nigerian GDP Report Q2 2024 on Monday.
The GDP growth rate surpasses the 2.51% recorded in the second quarter of 2023 and the 2.98% growth seen in the first quarter of 2024.
The GDP performance in Q2 2024 was primarily driven by the Services sector, which grew by 3.79% and contributed 58.76% to the total GDP. The agriculture sector saw a growth of 1.41%, slightly down from the 1.50% growth recorded in Q2 2023.
The industry sector improved significantly, with a growth of 3.53%, compared to the -1.94% decline observed in the second quarter of 2023.
In terms of GDP share, the industry and services sectors contributed more to the total GDP in the second quarter of 2024 compared to the same period in 2023.
The oil sector contributed 5.70% to the total real GDP in Q2 2024, an increase from the 5.34% recorded in the same period of 2023, but a decrease from the 6.38% contribution in the preceding quarter.
The oil sector experienced a real growth of 10.15% year-on-year in Q2 2024, marking a significant increase of 23.58 percentage points compared to the -13.43% recorded in the same quarter of 2023.
This growth also represents a 4.45 percentage point rise from the 5.70% recorded in Q1 2024.
However, on a quarter-on-quarter basis, the oil sector saw a decline, with a growth rate of -10.51% in Q2 2024.
Nigeria recorded an average daily oil production of 1.41 million barrels per day (mbpd), in Q2, 2024 which is 0.19 mbpd higher than the average 1.22 mbpd recorded in the same quarter of 2023.
However, this figure is 0.16 mbpd lower than the 1.57 mbpd produced in the first quarter of 2024.
The non-oil sector contributed 94.30% in real terms to the nation’s GDP in the second quarter of 2024.
This is slightly lower than the 94.66% share recorded in the second quarter of 2023 but higher than the 93.62% contribution in the first quarter of 2024.
The non-oil sector grew by 2.80% in real terms during Q2 2024.
This growth rate was 0.78 percentage points lower than the 3.58% recorded in the same quarter of 2023, and it matched the 2.80% growth seen in the first quarter of 2024.
The sector’s performance in Q2 2024 was primarily driven by Financial and Insurance (Financial Institutions), Information and Communication (Telecommunications), Agriculture (Crop Production), Trade, and Manufacturing (Food, Beverage, and Tobacco), all of which contributed to positive GDP growth.
Meanwhile, the Director General of the World Trade Organization ,WTO, Ngozi Okonjo-Iweala, has observed that Nigeria’s Gross Domestic Product ,GDP, growth rate on average has been steadily declining since 2014, signalling a downturn in the economic well-being of the average Nigerian.
Okonjo-Iweala, speaking at the annual General Conference of the Nigerian Bar Association ,NBA, on Sunday, noted that the country’s economic fortunes experienced a reversal following the decade between 2000 and 2014, during which the average GDP growth rate was approximately 3.8%.
According to the Director-General of the WTO, this consistent GDP growth outpaced the nation’s population growth, which was only around 2.6% annually.
However, she pointed out that since 2014, the situation has reversed, with GDP showing a negative growth rate of 0.9%, as the government has been unable to sustain the positive growth achieved by previous administrations.
“Many of the big problems the NBA is grappling with today has its root in Nigeria’s failure to sustain rate of economic growth and development that consistently outpaced the growth of our population.
“We have had episodes of reforms and faster economic growth that was not merely a function of the price of oil. But we have been unable to consolidate and build on them and millions of our compatriots have paid the price in terms of diminished job prospects and human well-being.
“For example, in the decade between 2000 and 2014, we have an average GDP growth rate of 3.8% well above our population growth rate of 2.6% per annum, meaning that people were on average truly improving their standard of living.
“During the following decade, average annual GDP per capita has been negative around minus 0.9% meaning people were worse off because we were not able to sustain prior positive growth momentum,” Okonjo-Iweala added.
Speaking further, Okonjo-Iweala said the country needs to sustain good economic policies irrespective of the administration or political party in power in order to foster development in the country.
The former Finance Minister said policy inconsistencies have accounted for the reversal in the fortune of the nation’s economic development.
Furthermore, she advocated for a social contract between the government and the people which will go beyond the political party in power.
According to her, this social contract must be generally accepted on what economic policies should be followed regardless of who is in power.
“Maintaining good economic and social policies; maintaining policy consistency and adding more reforms on top of that will lead us along the path of good progress that we all desire”, she added.
Nigeria’s Gross Domestic Product ,GDP, growth declined to 2.98%, lower than the rate recorded in the fourth quarter of 2023 which was 3.46%, according to a report from the National Bureau of Statistics ,NBS.
However, the GDP growth rate in the quarter is higher than the figure recorded in the corresponding quarter of 2023 which was 2.31%.
In the past decades, Nigeria’s economic growth has been moderate as a result of low exports, a reduction in the sales of oil which accounts for about 90% of our revenue as well as other economic challenges in the country.
Meanwhile, President Bola Tinubu has continuously said he would increase Nigeria’s GDP to a $1 trillion economy, but many analysts believe such a goal may not the feasible amid growing concerns of high inflation, low employment rate as well and rising national debt.
