How Nigeria achieved its fastest quarterly GDP growth in five years

Nigeria’s economy recorded its strongest quarterly growth in five years in the second quarter of 2026, with real Gross Domestic Product (GDP) expanding by 4.43% year-on-year.

This is according to the latest data released by the National Bureau of Statistics (NBS).

The Q2 performance was an improvement from the 3.89% growth recorded in Q1 2026 and the 3.87% full-year growth in 2025.

The 4.43% expansion is the highest quarterly growth recorded since Q2 2021, when the economy grew by 5.01% on the back of a post Covid-19 Pandemic induced recession bounce.

The latest expansion was driven by a broader improvement across key sectors, with agriculture and telecommunications emerging as major contributors. Together, the two sectors accounted for about 2.1 percentage points of the 4.43% growth, with telecommunications contributing approximately 0.95 percentage point and agriculture about 1.15 percentage points.

What the data is saying

Agriculture was one of the biggest drivers of the Q2 expansion, supported by a sharp improvement in livestock production.

• Livestock growth accelerated to 6.92% in Q2, compared with 2.20% in Q1. The sector had barely grown in 2025, recording just 0.08% for the full year.
• This recovery made livestock the single biggest swing factor between the first and second quarters and significantly strengthened agriculture’s contribution to overall GDP.
• Telecommunications also remained a major growth engine despite recording a slower expansion than in the previous quarter. The ICT sector grew by 9.62% in Q2, down from 10.98% in Q1.

Even with the moderation, the sector’s large economic weight meant telecommunications still contributed roughly 0.95 percentage point to headline GDP growth.

Oil rebounds as services gather pace

The oil sector provided another important boost to the economy during the quarter.

• Crude petroleum growth increased to 7.31% in Q2, compared with 2.57% in Q1. The stronger performance restored part of the contribution lost during the first quarter and added roughly a quarter of a percentage point to overall growth.
• Several service-related sectors also recorded stronger performances.
• Accommodation and food services expanded by 6.96%, up from 4.36% in Q1, while insurance accelerated to 16.13% from 9.94%.
• Real estate growth also improved, rising to 3.76% from 2.29% in the preceding quarter.

The simultaneous improvement across agriculture, oil, trade, construction, hospitality and other services created a broader base for economic expansion.

Some sectors continued to drag growth

The Q2 recovery was not uniform across the economy.

• ICT growth slowed from 10.98% to 9.62%, although the sector remained one of the largest contributors because of its significant weight in GDP.
• Transportation also lost momentum, expanding by 5.70% compared with 7.41% in Q1. The slowdown is more pronounced when compared with its 16.92% growth for full-year 2025.
• Electricity and gas remained another major weakness. The sector contracted by 10.63% in Q2, although this was an improvement from the 15.30% contraction recorded in Q1.

The continued weakness in power supply therefore remained a drag on the economy despite the stronger performance in other sectors.

What made Q2 different?

The main feature of the Q2 performance was not the acceleration of one sector alone but the simultaneous improvement across several major parts of the economy.

• Livestock recovered strongly, crude oil production growth accelerated, and sectors such as hospitality, insurance and real estate gained momentum. Agriculture also benefited from the livestock recovery, while telecommunications maintained a high growth rate despite moderating.
• This broader-based expansion helped offset weaker performances in ICT, transportation and electricity.

In effect, Q2 growth was less dependent on a single engine and more supported by a combination of agriculture, oil, services and other productive activities.

What you should know

Nairametrics earlier reported that Nigeria’s economy grew by 4.07% year-on-year in real terms in the fourth quarter (Q4) of 2025.

• Global institutions have expressed cautious optimism about Nigeria’s growth trajectory earlier in the year.
• The World Bank has maintained its 4.4 per cent growth forecast for Nigeria in 2027.
• The World Bank upgraded Nigeria’s 2026 growth estimate to 4.4% from 3.7% projected in June 2025.
• S&P Global Ratings upgraded Nigeria’s long-term foreign and local currency credit ratings to ‘B’ from ‘B-’.
• Earlier in April, the International Monetary Fund cut Nigeria’s economic growth forecast for 2026 by 0.3 percentage points to 4.1% from an earlier projection of 4.4%, citing mounting global and domestic pressures.

Also, Nairametrics earlier reported that Moody’s revised Nigeria’s sovereign outlook to “positive” from “stable”, citing stronger foreign exchange reserves and better-than-expected economic growth as factors improving the country’s ability to withstand external shocks.