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Tuesday, May 17, 2022

Nigeria’s economy grows 3.4% yr-on-yr in 2021, driven by non-oil sector

By Oludare Mayowa 

Nigeria’s Gross Domestic Product (GDP) grew by 3.98 percent in the fourth quarter of 2021, its biggest growth since 2014, according to latest data by the nation’s statistics agency.

The National Bureau of Statistics (NBS) report showed that fourth quarter growth indicates a steady economic recovery accounting for an annual growth of 3.40 percent in 2021.

“Nigeria Gross Domestic Product grew by 3.98 percent (year-on-year) in real terms in the fourth quarter of 2021, showing a sustained positive growth for the fifth quarter since the recession witnessed in 2020 when output contracted by -6.10 per cent and -3.62 per cent in Q2 and Q3 of 2020 under the Covid pandemic.

“The fourth quarter growth indicates a steady economic recovery accounting for annual growth of 3.40 percent in 2021.

“The Q4 2021 growth rate was higher than the 0.11 percent growth rate recorded in Q4 2020 by 3.87 percent points and lower than 4.03 percent recorded in Q3 2021 by 0.05 percent points. Nevertheless, quarter on quarter, real GDP grew at 9.63 percent in Q4 2021 compared to Q3 2021, reflecting a higher economic activity than the preceding quarter.”

The Oil sector contributed 5.19 percent to total real GDP in Q4 2021, down from figures recorded in the corresponding period of 2020 and down compared to the preceding quarter, where it contributed 5.87 percent and 7.49 percent respectively.

READ ALSO: Nigeria posts $3.68 bln balance of payment surplus in Q3 2021

On the other hand, the non-oil sector grew by 4.73 percent in real terms during the reference quarter (Q4 2021). This rate was higher by 3.05 percent point compared to the rate recorded same quarter of 2020 and 0.71 percent point lower than the third quarter of 2021.

The report showed that in Q4, aggregate GDP stood at N49.27 million in nominal terms.

“This performance is higher when compared to the fourth quarter of 2020 which recorded aggregate GDP of N43,564,006.29 million, indicating a year-on-year nominal growth rate of 13.11 percent.

“The nominal GDP growth rate in Q4 2021 was higher relative to 10.07 percent growth recorded in the fourth quarter of 2020 but lower compared to 15.41 percent growth recorded in the preceding quarter,” the NBS stated.

“The 2021 annual nominal growth stood at 13.92 percent. For better clarity, the Nigerian economy has been classified broadly into the oil and non-oil sectors.”

The report, the non-oil economy grew by 4.73 percent in the quarter from a year earlier, bolstered by 3.58 percent growth in agriculture and 5 percent in services. The oil sector contracted by 8.06 percent in the fourth quarter and an annual growth rate of -8.30 percent in 2021.

Four sub-activities make up the Agricultural sector: Crop Production, Livestock, Forestry and Fishing. The sector grew by 12.86 percent year-on-year in nominal terms in Q4 2021, showing a fall of 1.17 percent points from the same quarter of 2020.

Looking at the preceding quarter’s growth rate of 7.95 percent, there was an increase of 4.92 percent points. Crop Production remained the major driver of the sector.

This is evident as it accounts for 91.23 percent of overall nominal growth of the sector in fourth quarter 2021.

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