People & Money

Nigeria Records 3.52% GDP Growth in Q4 2022

In Q4 2022, Nigeria experienced a real year-on-year GDP growth rate of 3.52%. This represents an increase from the growth rate of 2.25% in the third quarter of 2022 and a slight decrease from the growth rate of 3.98% in the fourth quarter of 2021.

Nigeria’s GDP growth rate for 2022 was brought down to 3.1% by the growth rate recorded in the fourth quarter of 2022. This represents a decrease from the 3.4% growth rate reported in 2021.

The services sector was the main driver of the GDP’s performance in the fourth quarter of 2022, contributing 56.27% to the aggregate GDP and recording a growth rate of 5.69%. Despite a growth rate of 2.05% in the reference period, the agriculture sector’s performance was greatly hindered by severe flooding experienced throughout the country. As a result, the sector recorded a lower growth rate compared to the 3.58% achieved in the fourth quarter of 2021. Furthermore, the industry sector faced challenges in Q4 2022, recording a growth rate of -0.94% and contributing less to the aggregate GDP when compared to both Q3 2022 and Q4 2021.

Also Read: Nigeria’s Inflation Rate Reaches 14.23 Percent in October, Above CBN Forecast

In the oil sector, Nigeria recorded an average daily oil production of 1.34 million bpd in the reference period, lower than the daily average production of 1.50 million bpd recorded in Q4 2021, but higher than the production volume of 1.20 million bpd recorded in Q3 2022. In Q4 2022, the oil sector experienced a year-on-year growth rate of -13.38%, a decline of 5.33% from the rate recorded in Q4 2021. However, the sector grew by 9.29% when compared to Q3 2022 which recorded a growth rate of -22.67%. The annual growth rate of the oil sector was -19.22%, which is lower than the -8.30% recorded in 2021.

In Q4 2022, the oil sector’s contribution to the total real GDP was 4.34%, which is lower than the figures recorded in Q4 2021 and Q3 2022. In Q4 2021, the Oil sector contributed 5.19%, and in Q3 2022, it contributed 5.66%. In 2022, the oil sector’s total contribution to the aggregate GDP was 5.67%.

The non-oil sector experienced a real growth rate of 4.44% in Q4 2022. This rate was 0.29% points lower than the rate recorded in the same quarter of 2021 but 0.18% points higher than the third quarter of 2022. Positive growth in the non-oil sector for Q4 2022 was mainly driven by: Information and Communication (Telecommunication); Trade; Agriculture (Crop Production); Financial and Insurance (Financial Institutions); Manufacturing (Food, Beverage & Tobacco); Real Estate and Construction.

Also Read: Nigerian Banks Unlikely to Boost Lending Despite CBN’s Biggest Policy Rate Cut in 6 Years 

The non-oil sector’s contribution to the nation’s GDP in the fourth quarter of 2022 was 95.66% in real terms, which is higher than the share recorded in the fourth quarter of 2021 (94.81%) and the third quarter of 2022 (94.34%). Furthermore, in 2022, the non-oil sector contributed 94.33% to the aggregate GDP, which is higher than the 92.76% reported in 2021.

The mining and quarrying sector which comprises crude oil and natural gas, coal mining, metal ore, quarrying, and other mineral sub-activities experienced a nominal decline of -1.07% year-on-year in Q4 2022. The sector declined by -11.39% (year-on-year) in real terms in the fourth quarter of 2022. This is lower by 5.23% points compared to the same quarter of 2021 and higher by 9.92% points compared to the third quarter of 2022.

The sub-activity of Quarrying and Other Minerals had the highest growth rate of 47.85%, followed by the Metal Ore activity at 22.72% in the sector. In the fourth quarter of 2022, the Mining & Quarrying sector contributed 4.51% to the overall GDP, which is lower than the contributions recorded in the fourth quarter of 2021 (5.25%) and the previous quarter (7.32%). In nominal terms, the total contribution of the Mining & Quarrying sector in 2022 was 6.85%.

Also Read: Nigeria’s Banking Industry – The Past We Must Confront

The agriculture sector experienced year-on-year growth of 18.67% in Q4 2022 in nominal GDP, indicating an increase of 5.81% points from the same quarter of 2021. The major driver of the sector was Crop Production, as it accounted for 91.58% of the overall nominal value of the sector in the fourth quarter of 2022.

In the fourth quarter of 2022, Agriculture accounted for 24.90% of the nominal GDP, which was higher than the rate recorded in the same quarter of 2021 (24.17%) but lower than the third quarter of 2022 (27.55%). Overall, the sector contributed 24.05% to the nominal GDP in 2022.

In Q4 2022, the sector’s contribution to the overall real GDP was 26.46%, lower than its contribution in Q4 2021 (26.84%) and also lower than the contribution in the third quarter of 2022 (29.67%). The agriculture sector’s total contribution to real GDP in 2022 was 25.58%.

The manufacturing sector experienced nominal GDP growth of 8.86% (year-on-year) in the fourth quarter of 2022, which was lower by 16.66% points compared to the corresponding period of 2021 (25.52%), and higher by 6.66% points than the preceding quarter figure of 2.20%. The sector’s growth rate in 2022 was 6.93% in total, which is lower than the 31.66% recorded in 2021.

In Q4 2022, the manufacturing sector contributed 13.49% to the Nominal GDP, which was a decrease from both Q4 2021 (14.28%) and Q3 2022 (13.75%).

The manufacturing sector experienced a year-on-year real GDP growth of 2.83% in the fourth quarter of 2022. This growth rate was higher than that of the same quarter in 2021 and higher than the previous quarter by 0.55% points and 4.74% points, respectively. The growth rate of manufacturing in 2022 was 2.45% overall.

In Q4 2022, the manufacturing sector’s contribution to real GDP was 8.40%, which was a decrease compared to Q4 2021 where it was 8.46%, and Q3 2022 where it was 8.59%.

David Olujinmi

David Olujinmi studies Engineering but his true passion is research and analysis. He writes about finance, particularly the capital market, investment banking, and asset management. More »

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