…Services and allied sectors drive growth
BY KENNETH EZE
The Q2 2021 GDP report by the National Bureau of Statistics, shows that the country grew GDP by 5.01 per cent, year-on-year, during the period, which is the strongest since Q4 2014.
A media statement from the NBS stated, “During the quarter, Nigeria’s Gross Domestic Product grew by 5.01 per cent (year-on-year) in real terms, resulting in the third consecutive quarter of growth since last year’s slowdown. This is the strongest real GDP growth the economy has recorded since Q4 2014.”
Comparatively, the growth rate reflects much better economic performance compared to the same period last year, which recorded -6.10 per cent growth rate.
The report also shows that, “it was also better than the previous quarter (Q1) growth rate of 0.51 per cent, on a year-on-year basis. Year to date, real GDP grew 2.70 per cent in 2021 compared to -2.18 per cent for the first half of 2020,” the statement added.
Generally, the growth was driven by the Services sector, which recorded a strong performance growing at 9.27 per cent, during the quarter. This represents the fastest growth in the services sector since 2010.
But for decline in the Agricultural sector which was pegged at 1.30 per cent, and the Industrial sector as well as Crude Oil and Natural sector which contracted by -1.23 per cent and 12 per cent respectively, year-on-year, during the period, the results would have been much stronger.
However, the non-oil sector was a major driver of growth during the quarter, recording a growth rate of nearly 7 per cent which represents the fastest growth in the non-oil sector since Q3 2014.
The report listed, Trade, Transportation, Coal mining, Metal ores, as well as Insurance, as the main drivers of the economy with each of them weighing in with double digit growth in Q2 2021.
The impact would be more appreciated viewed against the fact that areas such as Oil refining, Crude petroleum and natural gas production as well as financial services recorded negative quarterly growth during the period.
Overall, a total of 42 out of 46 economic activities expanded during the quarter compared to only 13 at the same time last year, while 37 activities performed better than they did last quarter (Q1)
“These figures,” the NBS said, “indicate that business and commercial activities are fully returning to pre-pandemic levels as restrictions to movement, business activities, as well as domestic and international travel have been relaxed.”
The NBS is optimistic that these figures point to a bright future for the national economy, given that the “estimates are considered along with declining inflation rate which slowed from 18.17 per cent at the end of Q1 to 17.75 per cent at the end of Q2 and as at July, stands at 17.38 per cent,”
It expects that economic activities should return to normal, sooner than later, particularly with local and global circumstances combining to support economic growth.
“It is clear that the economic recovery is gradually picking up steam. With favourable international economic conditions expected as economic activities and normalcy returns across major economies, and local conditions continue to improve to allow business activities, the Nigerian economy is expected to maintain a steady path to more inclusive growth,” it added.
