The Minister of Finance, Budget, and National Planning, Mrs Zainab Ahmed, stated that the 5.01% GDP growth recorded in the second quarter of 2021 by Nigeria is a sign the economic recovery is gradually picking up steam.
She added that the economic recovery was boosted by favourable international economic conditions expected as economic activities and normalcy returns across major economies, adding that the agriculture sector slowed down growth as it grew by 1.30%.
The Minister disclosed this on Monday in a meeting with newsmen over Nigeria’s recent GDP report.
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“Furthermore, it was also better than the previous quarter (Q1) growth rate of 0.51 percent on a year-on-year basis. Year to date, real GDP grew 2.70 percent in 2021, compared to -2.18 percent for the first half of 2020,” she said.
“Broadly speaking, the services sector recorded a strong performance growing at 9.27 percent during the quarter, representing the fastest growth in the services sector since 2010.
“Growth in Q2 2021 would have been much stronger had it not been for agriculture recording slower growth at 1.30%,” she added.
She added that the non-oil sector was a major driver of growth during the quarter, recording a growth rate of nearly 7% which represents the fastest growth in the non-oil sector Q3 2014, citing specific sectors that recorded growth during the quarter including trade, transportation, coal mining, metal ores, as well as insurance, each of which recorded double-digit growth.
“When these estimates are considered along with declining inflation rate which slowed down from 18.17 percent at the end of Q1 to 17.75 percent at the end of Q2 and as at July, stands at 17.38 percent.
“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,” she stated.
She added that as local conditions continue to improve to allow business activities, the Nigerian economy is expected to maintain a steady path to more inclusive growth.
What you should know
Nairametrics reported last week that Nigeria’s s Gross Domestic Product (GDP) grew by 5.01% (year-on-year) in real terms in the second quarter of 2021, marking three consecutive quarters of growth following the negative growth rates recorded in the second and third quarters of 2020.
The non-oil sector grew by 6.74% in real terms while the oil sector declined by 12.65% year-on-year.
The contribution of the non-oil sector grew from 90.75% recorded in the previous quarter to 92.58% in Q2 2021 while the oil sector contribution declined from 9.25% to 7.42%.
Year to date, real GDP grew 2.70% in 2021 compared to -2.18% for the first half of 2020. Nevertheless, quarter on quarter, real GDP grew at -0.79% in Q2 2021 compared to Q1 2021, reflecting slightly slower economic activity than the preceding quarter due largely to seasonality.