Research Document: NESG GDP 2023 Q2 Alert

Posted Mon, Aug 28, 2023 7:37 PM

Key Highlights from the NESG Alert on Nigeria’s GDP for 2023Q2

• The Nigerian economy grew faster by 2.5 percent (year-on-year) in the second quarter of 2023. On a quarterly basis, the country’s GDP fell by 0.1 percent, reflecting the waning effects of the Naira scarcity accompanying the currency redesign policy implemented intensely earlier in the year.

• The Non-oil sector - the main driver of economic growth - expanded by 3.6 percent (year-on-year) in 2023Q2. Conversely, the oil sector contracted sharply by 13.4 percent, attributed mainly to the fall in the country’s average domestic crude oil production on a yearly and quarterly basis.

• The broad sectors exhibited mixed performances. The Agricultural sector grew by 1.5 percent in 2023Q2 after a brief contraction in the previous quarter. However, the Industrial sector moved into negative growth territory, contracting by 1.9 percent (year-on-year). In addition, the Services sector maintained a positive growth trajectory, expanding by 4.4 percent (year-on-year) in the quarter.
   
• The Road Transport sub-sector led the eight (8) contracting activities with a negative growth of -55.1 percent in 2023Q2. This reflects the impact of the fuel subsidy removal, which has drastically reduced the demand for petrol and constrained the movement of many transporters and commuters.