In line with our expectation, Nigeria’s real Gross Domestic Product grew year-on-year (y-o-y) by 1.87% to N16.74 trillion in Q1 2020, slower than 2.55% growth registered in Q4 2019.
Thank you for reading this post, don't forget to subscribe!The non-oil sector which accounted for the relatively weak GDP growth rate, grew y-o-y by 1.55% (but contracted by 16.29% quarter-on-quarter) to N15.15 trillion.
This was majorly due to the 2.82% and 4.75% contraction withnessed in Trade and Real Estate sectors to N2.69 trillion and N0.87 trillion respectively (of which trade and real estate joint share of GDP constituted 21.29%).
On the other hand, agricultural, information & communications and manufacturing sectors, which jointly accounted for 45.69% of total GDP, all grew y-o-y by 2.20%, 7.65% and 0.43% respecively in Q1 2020, albeit, slower than 2.31%, 8.50% and 1.24% respectively in Q4 2019.
The financial services sector spiked by 20.79% even as its share of real GDP rose to 3.81%, from 3.19% it printed in Q4 2019.
The oil & gas sector grew y-o-y by 5.06%, albeit slower than 6.36% recorded in Q4 2019 – average price of Nigeria’s sweet crude, bonny light fell q-o-q by 20.11% to USD52.07 per barrel in Q1 2020, while its averaged crude oil production rose q-o-q by 0.55% to 1.8 million barrels per day (mb/d).
With the sharp decline in crude oil prices, especially in the month of April 2020 – bonny Light average price was USD20.29/b –, coupled with the significant reduction in transactons seen in the non-oil sector amid lockdown orders, we expect a negative growth in Nigeria’s Q2 2020 real GDP.