Nigeria’s Gross Domestic Product (GDP) recorded a year-on-year growth of 3.19% in real terms during the second quarter of 2024, marking a notable increase from the 2.51% growth observed in the same period of 2023 and the 2.98% growth in the first quarter of 2024.
The robust GDP performance in Q2 2024 was largely fueled by the Services sector, which expanded by 3.79% and accounted for 58.76% of the total GDP. The Agriculture sector, while experiencing a slight dip, grew by 1.41%, compared to the 1.50% growth achieved in Q2 2023. Meanwhile, the Industry sector showed a remarkable turnaround, with a growth rate of 3.53%, a significant improvement from the -1.94% decline recorded in the second quarter of the previous year.
In terms of GDP contribution, both the Industry and Services sectors increased their share in Q2 2024 compared to the same period in 2023. The Oil sector, which contributed 5.70% to the total real GDP in Q2 2024, also saw a rise from the 5.34% contribution in Q2 2023, though it was slightly down from the 6.38% share in the first quarter of 2024.
The Oil sector experienced substantial real growth of 10.15% year-on-year in Q2 2024, a striking 23.58 percentage point increase from the -13.43% contraction observed in Q2 2023, and a 4.45 percentage point improvement from the 5.70% growth recorded in Q1 2024. However, on a quarter-on-quarter basis, the Oil sector witnessed a decline, with a growth rate of -10.51% in Q2 2024.
The average daily oil production in Q2 2024 stood at 1.41 million barrels per day (mbpd), which is 0.19 mbpd higher than the 1.22 mbpd recorded in Q2 2023, but 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 Q2 2024. While this was slightly lower than the 94.66% share recorded in Q2 2023, it surpassed the 93.62% contribution in Q1 2024. The non-oil sector grew by 2.80% in real terms during Q2 2024, a decrease of 0.78 percentage points from the 3.58% growth recorded in Q2 2023, but consistent with the 2.80% growth in Q1 2024. This sector’s performance 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 made significant contributions to the positive GDP growth in the second quarter of 2024.
Reacting, a former Commissioner for Finance, Prof Uche Uwaleke said for the mere fact that the financial sector grew by 28.79%, was a clear demonstration that it is detached from the productive sectors of the economy.
“In my view, this identified growth pattern, weighted in favour of the services sector, is not healthy for a developing economy such as ours. Little wonder, economic growth does not appear inclusive, reflecting rising unemployment and poverty levels.
“It is time we reset this faulty economic structure, leveraging technology, in favour of the productive sectors: industry and agriculture.
-By Growth not healthy, productive sector ailing –Uwaleke