Home Business Nigeria GDP shrinks to 1.87% year-on-year on COVID-19 disruptions

Nigeria GDP shrinks to 1.87% year-on-year on COVID-19 disruptions

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Oil sector growth decreased by –1.30% points when compared to Q4 2019 which was 6.36%.

MON, MAY 25 2020-theG&BJournal- Nigeria GDP grew at one of its slowest pace of expansion since the third quarter of 2018.

The latest data published by the National Bureau of Statistics (NDS), shows growth by 1.87% (year-on-year) in real terms, a significant drop from the 2.55% recorded in the previous quarter and reflected the profound effect of the COVID-19 on the economy.

The performance recorded in Q1 2020 represents a drop of –0.23% points compared to Q1 2019 and –0.68% points compared to Q4 2019, reflecting the earliest effects of the disruption, particularly on the non-oil economy.

On a quarterly basis, the GDP dropped 14.27%, following a 5.59% expansion in the previous quarter.

In the quarter under review, aggregate GDP stood at N35,647,406.08 million in nominal terms. This performance was higher when compared to the first quarter of 2019 which recorded N31,824,349.67 million, with a nominal growth rate of 12.01% year on year.

Relative to the first quarter of 2019, the nominal growth rate was higher by 0.11% points but lower than the proceeding quarter by –0.32% points. For better clarity, the Nigerian economy has been classified broadly into the oil and non-oil sectors.

According to the NBS data, the oil sector recorded a real growth rate of 5.06% (year-on-year) in Q1 2020 indicating an increase of 6.51% points relative to the rate recorded in the corresponding quarter of 2019. However, growth decreased by –1.30% points when compared to Q4 2019 which was 6.36%. Quarter-on-quarter, the oil sector recorded a growth rate of 11.30% in Q1 2020.

The sector contributed 9.50% to aggregate real GDP in Q1 2020, up from figures recorded in the corresponding period of 2019 and the preceding quarter, as the share of the non-oil economy declined.

The non-oil sector grew by 1.55% in real terms during the reference quarter (Q1 2020). This was slower by –0.93% points compared to the rate recorded during the same quarter of 2019, and –0.72% points slower than the fourth quarter of 2019. The non-oil sector was driven mainly by Information and Communication (Telecommunications), Financial and Insurance (Financial Institutions), Agriculture (Crop Production),

In real terms, the Non-Oil sector contributed 90.50% to the nation’s GDP in the first quarter of 2020, less than its share in the first quarter of 2019 which was 90.78% and the fourth quarter of 2019 recorded as 92.68%. Activities that witnessed weaker performance relative to Q1 2019 include Quarrying, Road transport, Accommodation and Food services as well as real estate.

The agricultural sector in the first quarter of 2020 grew by 2.20% (year-on-year) in real terms, a decrease of –0.97% points compared to the corresponding period of 2019, and –0.11% points from the preceding quarter which recorded a growth rate of 2.31%. On a quarter on quarter basis, real agriculture sector growth was –27.81%.

However, the sector contributed 21.96% to overall GDP in real terms in Q1 2020, slightly higher than the contribution in the first quarter of 2019 but lower than the fourth quarter of 2019 which stood at 21.89% and 26.09% respectively.

The manufacturing registered 0.43% (year on year), lower than the same quarter of 2019 as well as the preceding quarter by –0.38% points and –0.81% points respectively. Growth rate of the sector, on a quarter-on-quarter basis, stood at –5.38%, lower than the quarter on quarter growth rate recorded in the preceding quarter of 2019. Real contribution to GDP in 2020 first quarter was 9.65%, lower than the 9.79% recorded in first quarter of 2019 but higher than the 8.74% recorded in Q4 2019.

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