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Economy continues on slower growth as real GDP hovers around 1.94%

The latest figures released by the National Bureau of Statistics (NBS) on Nigeria’s Q2-19 GDP figure, showed that the economy grew slower, with real GDP printing 1.94% y/y (vs. an upwardly revised 2.10% y/y in the previous quarter and 1.89% y/y in Q1-2018).

However, the growth estimate missed several experts’ projections including Cordros’ and Bloomberg’s compiled average estimate of 2.69% y/y and 2.33% by 75bps and 39bps, respectively.

A quick look at the breakdown of the GDP figure showed that the oil sector rebounded, growing by 5.15% (compared to -1.46% in Q1-19), after five consecutive quarterly declines. The NBS estimated crude oil production during the three-month period to be 1.98mb/d, 0.14mb/d higher than the 1.84mb/d reported in Q2-19, but slightly lower than the 1.99mb/d (revised from 1.96mb/d) recorded in Q1-19. The sector contributed 8.82% of total GDP (vs. 9.22% and 8.55% in Q1-19 and the corresponding quarter of 2018 respectively) during the review period.

Conversely, output in the non-oil sector printed a disappointing 1.64% y/y growth in Q2-19, 83bps lower than the rate recorded in the first quarter of 2019, as well as 40bps lower than the growth rate achieved a year ago. The non-oil sector contributed 91.18% to total GDP, (vs. 90.78% and 91.45% in Q1-19 and the corresponding quarter of 2018 respectively).

Analysing the breakdown of three of the biggest components of the GDP: Services grew by 1.94% y/y (vs. 2.41% y/y in Q1-19 and 2.12% y/y in Q2-18); Agriculture grew by 1.79% y/y, (vs. 3.17% y/y in Q1-19 and 1.19% y/y in Q2-18); Manufacturing (Industries) grew by 2.10% (vs. 0.42% y/y in Q1-19 and 0.40% y/y in Q2-18).

In terms of contribution, services, industries, and agriculture, respectively, accounted for 53.96%, 23.21%, and 22.82% of overall output growth.

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