Nigeria’s economy grew by 3.4% year-to-year in 2021 with an estimated value of N72.39 trillion in real terms, representing an uptick from the 1.92% contraction recorded in the previous year.
This is the fastest GDP growth rate recorded in Nigeria in 7 years. The last time Nigeria’s economy grew beyond 3.4% was in 2014, when the real GDP expanded by 6.22% year-on-year.
This is contained in the recently released GDP report by the National Bureau of Statistics (NBS).
According to the report, Nigeria’s real GDP increased from an estimate of N70.01 trillion recorded in 2020 to N72.39 trillion in 2021, representing a recovery from the recession recorded in the second and third quarters of 2020.
Meanwhile, in nominal terms Nigeria’s GDP grew by 13.92% year-on-year with an estimated value of N173.53 trillion compared to N152.32 trillion recorded in the previous year.
In terms of contribution to GDP, Agricultural sector’s contribution dropped from 26.21% recorded in 2020 to 25.88% in 2021, while services accounted for 53.56% of the country’s GDP, representing an uptick compared to 52.44% recorded in 2020. Industrial sector accounted for 20.56% of the total GDP.
Similarly, the oil sector’s contribution fell to 7.24% in 2021 from 8.16% in 2020, attributable to the downturn recorded in the performance of the oil sector. On the other hand, the non-oil sector contributed 92.76% to the GDP, increasing from 91.84% recorded in 2020.
Non-oil sector spurs growth
Transportation and storage sector, electricity and other notable non-oil sectors of the economy drove the significant growth recorded in 2021. For example, the transportation and storage sector recorded a 16.25% GDP growth in the review year as against the 22.26% contraction recorded in the previous year.
Also, electricity, gas, steam, and air conditioning supply recorded a 27.57% growth in real terms, overturning the 2.9% decline recorded in 2020, while the financial and insurance sector grew by 10.07% in 2021 as opposed to 9.37% growth printed in the previous year.
On the other hand, the information and communications sector, which was one of the best performing sectors during the pandemic, recorded a decline in its growth rate, as its GDP growth rate stood at 6.55% in 2021 compared to 13.18% recorded in the preceding year.
The slow growth recorded in the communications sector could be attributed to the halt in new sim registrations in December 2020 by the Nigerian Communications Commission (NCC), requesting for all subscribers to link their lines to their National Identity Numbers (NIN).
However, the agency has now lifted the ban and allowed for new sim registrations, which has now reflected in the numbers of active subscribers in the country.