The Nigerian economy grew at the slowest pace in three years to 2.74 percent in 2023 from 3.10 percent in 2022, according to the latest GDP report by the National Bureau of Statistics (NBS).
In the fourth quarter of last year, the country’s GDP grew by 3.46 percent, down from 2.54 percent in the previous quarter.
“This growth rate is lower than the 3.52 percent recorded in Q4 of 2022. The performance of the GDP in Q4 was driven mainly by the services sector, which recorded a growth of 3.98 percent and contributed 56.55 percent to the aggregate GDP,” the GDP report said.
The country’s full-year GDP growth is lower compared to the World Bank and International Monetary Fund projection of 2.9 percent.
A breakdown of the NBS report showed that the ICT sector slowed to 7.91 percent in 2023 from 9.76 percent in 2022. The manufacturing sector grew by 1.40 percent, down from 2.45 percent; while trade’s growth slowed to 1.66 percent from 5.13 percent.
The growth of the construction sector also slowed to 4.54 percent from 3.57 percent, and transportation and storage contracted by 30.17 percent as against 15.20 percent. The financial and insurance sector improved to 26.53 percent from 16.36 percent.
It said the agriculture sector grew by 2.10 percent, from the growth of 2.05 percent recorded in the fourth quarter of 2022.
“The slowdown last year compared to other years is a combination of the impact of the currency crunch in the first quarter as well as the pass-through impact of some of the reforms initiated by the new administration in the second half on the economy,” Omobola Adu, senior economist at BancTrust & Co, said.
The GDP report also revealed that two sectors which are other services, transportation and storage dropped to a negative growth rate in 2023 from a positive growth rate in the previous year.
Other services recorded a negative growth of -5.68 percent in 2023, compared to a positive growth rate of 1.07 percent in 2022.
The transportation and storage sector recorded a negative growth rate of -30.17 percent from a positive growth rate of 15.20 percent.
Mining and quarrying recorded a negative growth rate year-on-year to -2.84 percent from -18.16 percent.
Electricity, gas, steam and air conditioning supply recorded a positive growth rate of 5.56 percent from a negative growth rate of 2.21 percent.
The public administration sector recorded growth of 2.12 percent in 2023 from 1.9 percent in 2022.
The Nigerian Economic Summit Group, in its recent report, said since the economy rebounded from the recession induced by the Covid-19 pandemic, its growth has exhibited fragility.
“This deceleration was attributed to policy adjustments and reform shocks, prominently the implementation of the Naira redesign policy, resulting in a cash crunch that impacted various sectors, particularly the informal economy,” the report said.
Here are the best and worst-performing sectors
Best-performing sectors
Financial and insurance
The finance and insurance sector growth rate increased to 26.53 percent in 2023 from 16.36 percent in 2022.
The sector also grew by 29.78 percent in Q4 from 28.21 percent in the previous quarter.
Water supply, sewerage, waste management and remediation
The sector saw a decline in growth rate to 12.65 percent in 2023 from 13.62 percent in 2022.
It also dropped to 7.44 percent in Q4 from 11.93 percent in Q3.
Information and communication
The information and communication sector dropped to 7.91 percent in 2023 from 9.76 percent in 2022.
Its growth also declined to 6.33 percent in Q4 from 6.69 percent.
Electricity, gas, steam and air conditioning supply
The electricity, gas, steam and air conditioning supply
sector expanded to 5.56 percent in 2023 from a contraction of 2.21 percent in 2022.
The sector recorded a growth of 6.17 percent in Q4, up from 1.91 percent in Q3.
Arts, entertainment and recreation
The arts, entertainment and recreation sector recorded a marginal decline of 4.28 percent in 2023 compared to 4.29 percent in 2022.
The sector recorded a slower growth of 4.13 percent in Q4 from 4.45 percent in Q3.
Worst performing sectors
Transportation and storage
The transportation and storage sector contracted to -30.17 percent in 2023 from 15.20 percent in 2022. The sector has been in recession since Q2.
Other services
Other services recorded a negative growth of -5.68 percent in 2023, compared to a positive growth of 1.07 percent in 2022.
The sector recorded a growth of 0.05 percent in Q4 from 0.63 percent in the previous quarter.
Mining and quarrying
The mining and quarrying sector is still in recession in 2023. It recorded a negative growth rate of 2.84 percent compared to 18.16 percent in 2022. A recession is two consecutive quarters of contraction.
But in Q4, the sectors expanded to 8.04 percent from a negative growth of 1.96 percent.
Administrative and support services
The administrative and support services sector recorded a growth rate of 0.62 percent in 2023 from 3.16 percent in 2022.
The sector recorded a growth rate of 1.61 percent in Q4 from 2.77 percent in Q3.
Agriculture
The agriculture sector recorded a growth rate of 1.13 percent in 2023 compared to 1.88 percent in 2022.
The sector’s growth rate increased to 2.10 percent in Q4 from 1.30 percent in the previous quarter.
