The National Bureau of Statistics recently released data on the growth of Nigeria’s economy in 2019. The GDP report showed that the country’s economy had grown by 2.27 percent in the year just passed.
It had performed slightly better than many analysts (including those at the IMF) had expected. But it will need to grow even faster if it’s to affect the lives of regular people in any truly significant way.
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One of the talking points generated by the report has been the size of Nigeria’s oil and gas sector, and its contribution to the country’s annual income. Despite what many people think, the sector isn’t the biggest contributor to Nigeria’s wealth—and the NBS report bears this out clearly.
In fact, three sectors account for a greater portion of our GDP than the black gold and its derivatives. Here’s a run through those sectors.
If you’ve been listening to the cries of woe about Nigeria’s declining agricultural sector, you might be a bit surprised to learn that it’s still our biggest industry. It contributes almost a quarter of the domestic income.
Consider these numbers. In 2019, the sector churned out products worth over ₦30 trillion; that’s more than double what oil yields yearly. It also employs about 36 percent of the country’s population. Crop production, by far the largest agricultural sub-sector, took 22.67 percent of total GDP.
But Nigeria is changing. The numbers tell us there’s been a move away from farming in the past three decades. In 1992, more than half the country’s population were farmers; today, just one-third are connected with the occupation. As late as 1999, agriculture contributed 41 percent of our GDP.
Trade is the second biggest contributor to Nigeria’s annual income, accounting for 16.01 percent of GDP in 2019. The output from the sector was put at ₦22.509 trillion in that period.
Trade makes up a big chunk of the economy partly because it supports numerous individuals and households. One report from 2018 says that over 10 million Nigerians are engaged in trading activities, including imports and exports.
The sector has fluctuated over the past decade. It dipped in 2015, as the country slid towards a recession, but recovered somewhat afterward.
The dynamics of trade may change in the coming years, if the AfCFTA takes effect in Nigeria in July 2020 as scheduled.
The telecoms sector has grown quite rapidly from its low base in the early 2000s. In 2013, authorities in Nigeria decided to include it, as well as some other emerging sectors, in the country’s GDP. That move pushed up the size of Nigeria’s recorded income by 90 percent.
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Today, the telecoms industry contributes about 10.30 percent of the country’s GDP in real terms, more than the 8.78 percent delivered by oil and gas. However, its output is worth slightly less than the oil sector in nominal (current naira) terms.
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Featured image source: Oil and Gas IQ