Nigerian economy grew 1.87 per cent year-on-year in the first quarter of the year, driven by growth in the oil sector of the economy, the National Bureau of Statistics (NBS) said on Monday.
The NBS said the growth in the economy, “represents a drop of –0.23 per cent points compared to Q1 2019 and –0.68 per cent points compared to Q4 2019, reflecting the earliest effects of the disruption, particularly on the non-oil economy.”
Though the economic growth was slower than the 2.55 per cent recorded in the last quarter of 2019, the figure was significant because it “was recorded against the backdrop of significant global disruptions resulting from the COVID-19 public health crisis, a sharp fall in oil prices and restricted international trade.”
The bureau said the oil sector recorded a growth rate of 11.30 per cent in the first quarter with the sector contributed 9.50 percent to aggregate real GDP in Q1 2020.
The growth in the oil sector was up from figures recorded in the corresponding period of 2019 and the preceding quarter, as the share of the non-oil economy declined, the NBS said in its latest report.
Nigeria’s oil production output rose in the first quarter of 2020, to average daily oil production of 2.07 million barrels per day (mbpd) against 1.99 million barrels per daily in the first quarter of 2019.
“The oil sector recorded a real growth rate of 5.06 per cent (year-on-year) in Q1 2020 indicating an increase of6.51% points relative to the rate recorded in the corresponding quarter of 2019. However, growth decreased by –1.30 per cent points when compared to Q4 2019 which was 6.36 per cent,” the report said.
Nigeria continues to rely on the oil sector for 90 per cent of its foreign exchange earnings, leading to the projection that the economy could shrink by as much as 3.5 per cent this year on the back of the sharp drop in global oil prices and the impact of the coronavirus pandemic.
Nigeria’s oil revenues declined by N125.5 billion in the first quarter, an indication of the headwinds the economy is facing from the coronavirus pandemic and low crude prices and without stimulus, the economy could contract by 8.9 per cent, Finance Minister Zainab Ahmed said last week.