Nigeria’s GDP grows by 3.19% in Q2, 2024 – NBS
…ICT’s contribution to Nigeria’s real GDP hits 19.78%
…As health sector grows by 2.41%
By Seun Ibiyemi
Nigeria’s Gross Domestic Product (GDP) experienced a year-on-year growth of 3.19 percent in real terms during the second quarter of 2024.
The GDP growth rate surpasses the 2.51 percent recorded in the second quarter of 2023 and the 2.98 percent growth seen in the first quarter of 2024.
The GDP performance in Q2 2024 was primarily driven by the Services sector, which grew by 3.79 percent and contributed 58.76 percent to the total GDP. The agriculture sector saw a growth of 1.41 percent, slightly down from the 1.50 percent growth recorded in Q2 2023.
The industry sector improved significantly, with a growth of 3.53 percent, compared to the -1.94 percent decline observed in the second quarter of 2023.
In terms of GDP share, the industry and services sectors contributed more to the total GDP in the second quarter of 2024 compared to the same period in 2023.
Oil sector
The oil sector contributed 5.70 percent to the total real GDP in Q2 2024, an increase from the 5.34 percent recorded in the same period of 2023, but a decrease from the 6.38 percent contribution in the preceding quarter.
The oil sector experienced a real growth of 10.15 percent year-on-year in Q2 2024, marking a significant increase of 23.58 percentage points compared to the -13.43 percent recorded in the same quarter of 2023.
This growth also represents a 4.45 percentage point rise from the 5.70 percent recorded in Q1 2024.
However, on a quarter-on-quarter basis, the oil sector saw a decline, with a growth rate of -10.51 percent in Q2 2024.
Nigeria recorded an average daily oil production of 1.41 million barrels per day (mbpd), in Q2, 2024 which is 0.19 mbpd higher than the average 1.22 mbpd recorded in the same quarter of 2023.
However, this figure is 0.16 mbpd lower than the 1.57 mbpd produced in the first quarter of 2024.
Non-oil sector
The non-oil sector contributed 94.30 percent in real terms to the nation’s GDP in the second quarter of 2024.
This is slightly lower than the 94.66 percent share recorded in the second quarter of 2023 but higher than the 93.62 percent contribution in the first quarter of 2024. The non-oil sector grew by 2.80 percent in real terms during Q2 2024.
This growth rate was 0.78 percentage points lower than the 3.58 percent recorded in the same quarter of 2023, and it matched the 2.80 percent growth seen in the first quarter of 2024.
The sector’s performance in Q2 2024 was primarily driven by Financial and Insurance (Financial Institutions), Information and Communication (Telecommunications), Agriculture (Crop Production), Trade, and Manufacturing (Food, Beverage, and Tobacco), all of which contributed to positive GDP growth.
ICT sector
Activities in Information and Communications Technology (ICT) contributed 19.78 percent to Nigeria’s real Gross Domestic Product (GDP) in Q2 2024.
This shows a marginal increase in contribution when compared to the 19.54 percent recorded in the same period last year.
Quarter on quarter, the sector also recorded an increase in contribution when compared with the preceding quarter. The NBS data showed that ICT contributed 17.89 percent to the real GDP in Q1 2024.
According to NBS, the ICT sector comprises the four activities of Telecommunications and Information Services; Publishing; Motion Picture, Sound Recording, and Music Production; and Broadcasting.
The ICT sector in the quarter under review recorded a growth rate of 4.44 percent year-on-year. This was driven largely by activities in the telecommunications sub-sector, which contributed 16.36 percent to the GDP in the real term.
According to NBS, the telecom industry was the third-largest contributor to the real GDP in Q2 2024, coming behind only crop production and trade industries, which contributed 20.35 percent and 16.39 percent respectively.
The telecom industry, which is dominated by mobile network operators including MTN, Globacom, Airtel, 9mobile, and Internet Service Providers (ISPs) is also driving a lot of activities in every other sector of the economy.
The closest sub-sector to telecoms in the ICT sector in terms of contribution was Broadcasting, which added 2.54 percent
The NBS data further revealed that the ICT sector contributed 14.19 percent to the total Nominal GDP in the second quarter of 2024, lower than the rate of 14.83 percent recorded in the same quarter of 2023 and higher than the 13.12 percent it contributed in the preceding quarter.
In nominal terms, the sector growth was recorded at 11.86 percent (year-on-year), a 29.81 percent points decrease from the rate of 41.67 percent recorded in the same quarter of 2023, and 2.08 percent points lower than the rate recorded in the preceding quarter.
Health sector
The Nigerian health sector’s real GDP grew by 2.41 percent year-on-year in Q2 2024, up from 1.95 percent in the same quarter of 2023.
According to reports by the National Bureau of Statistics (NBS) released today, Nigeria’s Human Health and Social Services sector experienced a 2.41 percent year-on-year real GDP growth in the second quarter of 2024.
This figure marks a slight improvement from the 1.95 percent growth recorded in the same quarter of 2023, reflecting a 0.46 percentage point increase.
The sector demonstrated robust quarter-on-quarter growth, expanding by 3.96 percent in real terms. This substantial increase indicates accelerating momentum in the health sector’s development compared to the previous quarter.
Q2 2024’s growth outpaced the previous quarter’s performance by 0.29 percentage points, suggesting a positive trend in the sector’s real output.
Despite the growth, the sector’s contribution to real GDP stood at 0.75 percent in Q2 2024. This figure is lower than that recorded in Q2 2023 but shows an improvement from the 0.72 percent contribution in Q1 2024.
Contribution to overall GDP
Despite the sector’s robust growth, its contribution to Nigeria’s overall real GDP in Q2 2024 stood at 0.75 percent. While this represents a slight improvement from the 0.72 percent contribution recorded in Q1 2024, it is still lower than the 0.77 percent contribution observed in Q2 2023.
The modest contribution signifies the need for continued investment in the health sector to enhance its economic impact and ensure that it can meet the country’s healthcare demands effectively.
The accelerating real GDP growth suggests genuine expansion in the health sector’s output, potentially indicating increased service provision, improved healthcare access, or enhanced efficiency in the sector.
However, the relatively small contribution to overall GDP highlights the need for continued focus on and investment in healthcare to boost its economic impact.
The Federal Government’s recent moves to strengthen Nigeria’s health sector align with broader efforts to boost local drug production in a new partnership between the Presidential Initiative for Unlocking the Healthcare Value Chain and the US Pharmacopeial Convention (USP) to increase its local pharmaceutical production.
The agreement focuses on enhancing local drug production and regulatory oversight, with an ambitious target of achieving 70 percent local production and creating 30,000 new jobs by 2030.
The Federal Government also declared an Executive Order removing import duties, VAT, and excise duties on pharmaceutical raw materials, intermediate products, and medical diagnostic equipment and machinery.
The Director/CEO of CPPE, Dr. Muda Yusuf highlighted that this move is expected to reduce the cost of drugs, create jobs, and significantly enhance the well-being of citizens.
Additionally, the government signed a Memorandum of Understanding with Global Gases Group for the establishment of production plants for liquefied medical oxygen in Nigeria.
The Minister of Health and Social Welfare, Prof. Muhammad Ali Pate, announced that new gas plants, each capable of producing 100 tons of oxygen per day, will be established across northern and southern Nigeria.
