… Says Oil production drops to 1.94m barrels
By Kayode Tokede
The National Bureau of Statistics (NBS) has announced that Information and communication, Agriculture, Manufacturing, Trade, Transportation and Storage and Professional, Scientific and Technical Services lifted the nation’s Gross Domestic Product ( GDP) growth of 1.81 per cent in third quarter (Q3) of 2018.
The nation’s economy has been classified broadly into the oil and non-oil sectors.
The bureau in its ‘Nigerian Gross Domestic Product Report’ for Q3 states that the nation’s GDP recorded growth of 1.81 (year-on-year) in real terms in the third quarter of 2018, compared to the third quarter of 2017 which recorded a growth of 1.17per cent.
According to the NBS report, this translates into an increase of 0.64 per cent points.
The bureau had disclosed that the nation’s GDP in the second quarter of 2018 had a growth rate of 1.50 per cent showing a rise of 0.31per cent points, while in the first quarter, it reported 1.95 per cent in first quarter of 2018.
According to NBS GDP report released on Monday,. the non-oil sector increased by 2.32per cent in real terms during the quarter under review .
“This is higher by 3.08per cent points compared to the rate recorded same quarter of 2017 and 0.28per cent point higher than the second quarter of 2018. This sector was driven during this quarter mainly by Information and communication; other drivers were Agriculture, Manufacturing, Trade, Transportation and Storage and Professional, Scientific and Technical Services.
“In real terms, the Non-Oil sector contributed 90.62per cent to the nation’s GDP, higher from share recorded in the third quarter of 2017 recorded as 90.16per cent and lower than the second quarter of 2018 recorded as 91.45per cent.”
Commenting on the growth in GDP, Professor of Finance at Nasarawa State University, Prof. Uche Uwaleke, said the growth is cheering news, given the federal government’s implementation of the 2018 budget and the relative stability in the exchange rate that has aided production in the Non-oil sector of the economy.
According to him, “The Q3 2018 GDP report which shows that the economy recorded growth of 1.8per cent compared to 1.5per cent in Q2 is cheering news because it marked an end to the downward trend in GDP growth noticed since the first quarter of this year.
“Of note is the performance of the non oil sector where marginal improvements were recorded in manufacturing, especially cement production, Transportation and agriculture.
“This outcome may have been helped by the implementation of the 2018 budget which started at the beginning of the third quarter, the relative stability in the exchange rate as well as the CBN’s interventions in the real sector.
“Be that as it may, the growth is still weak and fragile particularly with respect to the sectors that have strong linkages to jobs. The performance of the financial services sector which is critical to the economy is disappointing.
“Going forward, there is the need to vigorously implement the capital component of the 2018 budget, invest more in education and health sectors which are lagging behind, tackle the incessant farmers-herdsmen clashes weighing down on food production and enhance access to credit by target beneficiaries of the various CBN intervention schemes.
“Overall, improvement in the ease of doing business will go a long way in increasing the risk appetite of financial institutions in Nigeria which will positively rub off on GDP growth.”
According to the NBS report, in the quarter under review, aggregate GDP stood at N33.37 trillion in nominal terms.
This, according to NBS is higher when compared to the third quarter of 2017 which recorded a GDP aggregate of N29.37 trillion thus, presenting a positive year on year nominal growth rate of 13.58per cent.
The report states that, “This growth rate is higher relative to growth recorded in the third quarter of 2017 by 2.88per cent points and higher than the proceeding quarter by 0.01per cent points with growth rates of 10.70per cent and 13.57per cent respectively.”
The report reveals that average daily oil production dropped to 1.94 million barrels in Q3 of 2018 as against 2.02 mbpd Q3 of 2017 but higher than that of the Q2 of 2018 production volume of 1.84mbpd by 0.10mbpd.
The NBS GDP report shows that real growth of the oil sector was –2.91 per cent (year-on-year) in Q3 2018 indicating a decrease of –25.94per cent points relative to rate recorded in the corresponding quarter of 2017.
“Growth increased by 1.04per cent points when compared to Q2 2018 which was –3.95per cent. Quarter-on-Quarter, the oil sector recorded a growth rate of 19.64per cent in Q3 2018.
“The Oil sector contributed 9.38per cent to total real GDP in Q3 2018, down from figures recorded in the corresponding period of 2017 and up compared to the preceding quarter, where it contributed 9.84per cent and 8.55per cent respectively,” the report added.