Nigeria’s economy expands by 3.84% in Q4 2024, driven by services sector

Nigeria’s economy recorded a year-on-year growth of 3.84% in real terms in the fourth quarter of 2024, reflecting an improvement from the 3.46% growth rate recorded in both the same period of 2023 and the preceding quarter.

This was disclosed in the latest Gross Domestic Product (GDP) report released by the National Bureau of Statistics (NBS), which attributed the growth primarily to the Services sector.

According to the NBS report, the Services sector expanded by 5.37% in Q4 2024, contributing 57.38% to the country’s total GDP. This sector’s strong performance was instrumental in driving overall economic expansion, despite subdued growth in the Agriculture and Industry sectors.

The Agriculture sector saw a slowdown, recording a growth rate of 1.76%, a decline from 2.10% in Q4 2023. The Industry sector also underperformed, growing by just 2.00%, significantly lower than the 3.86% growth posted in the same quarter of 2023.

For the full year 2024, Nigeria’s GDP expanded by 3.40%, up from 2.74% in 2023. In nominal terms, the total GDP for Q4 2024 stood at N78.37 trillion, marking an 18.91% increase from N65.91 trillion in Q4 2023.

Nigeria’s daily average oil production in Q4 2024 was recorded at 1.54 million barrels per day (mbpd), slightly lower than the 1.56 mbpd recorded in Q4 2023 but an improvement from 1.47 mbpd in Q3 2024.

Despite this, the oil sector’s real GDP growth slumped to 1.48%, a sharp drop from the 12.11% recorded in Q4 2023 and lower than the 5.17% posted in Q3 2024.

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The sector contributed 4.60% to total GDP, down from 4.70% in Q4 2023 and significantly lower than 5.57% in Q3 2024. However, for the full year, the sector expanded by 5.54%, recovering from a -2.22% contraction in 2023.

The non-oil sector continued to drive economic performance, growing by 3.96% in Q4 2024, up from 3.07% in Q4 2023 and 3.37% in Q3 2024. This sector accounted for 95.40% of total GDP, compared to 95.30% in the corresponding period of 2023.

Key contributors to the non-oil sector’s expansion included Financial and Insurance Services, Information and Communication (Telecoms), Agriculture (Crop Production), Trade, and Manufacturing.

The financial services sector remained one of the fastest-growing industries, expanding by 27.78% in real terms in Q4 2024, though slightly lower than the 29.77% recorded in Q3 2024. The sector contributed 6.10% to GDP, up from 4.95% in Q4 2023.

The telecoms industry continued its impressive growth, recording a 5.90% expansion in Q4 2024, slightly below the 6.32% posted in Q4 2023. Its GDP contribution increased to 17.00%, compared to 16.66% in the corresponding period of 2023

The trade sector recorded a real GDP growth rate of 1.19%, slightly lower than the 1.40% recorded in Q4 2023 but an improvement from the 0.65% growth in Q3 2024. It accounted for 15.11% of GDP.

The manufacturing sector expanded by 1.79% in real terms, up from 1.38% in Q3 2024. However, its GDP contribution declined to 8.07%, compared to 8.23% in Q4 2023.

The construction sector recorded a growth rate of 2.95% in real terms, slightly below the 3.70% recorded in Q4 2023. Its share of GDP stood at 3.44%, down from 3.47% in the same period last year.

The transport sector rebounded significantly, growing by 18.61% in real terms, a remarkable turnaround from the -29.00% contraction recorded in Q4 2023. The sector’s GDP contribution increased to 1.26%.

Conversely, the electricity, gas, and steam sector continued to struggle, contracting by -5.04% in real terms, a sharp decline from the 6.17% growth recorded in Q4 2023. Its GDP contribution stood at 0.49%.

The continued expansion of the Services sector, particularly in telecoms, financial services, and transport, suggests that the Nigerian economy is diversifying beyond oil dependence. However, structural reforms and policy interventions may be necessary to sustain growth momentum and address sectoral weaknesses.