Udoma Expresses Delight at Economic Performance after Recession
· Real GDP grew by 2.38% in Q4 2018
· Non-oil sector drives economic growth
· Services sector records best performance in 11 quarters
· 39 out of 46 economic activities record growth in Q4
Minister of Budget and National Planning, Senator Udoma Udo Udoma, has expressed delight at the 4th Quarter 2018 numbers just released by the National Bureau of Statistics (NBS). The report shows that the real Gross Domestic Product (GDP) grew by 2.38%, indicating the strongest quarter growth since the economy slipped into recession in 2016.
The full year 2018 real GDP stood at 1.93%, higher than the 0.82% growth rate recorded in 2017.
The Minister was particularly encouraged by the fact that the growth was largely driven by the non-oil sector which grew by 2.70% in the quarter, posting a growth of 2.0% for full year 2018, representing the strongest growth in non-oil GDP since the fourth quarter of 2015.
Senator Udoma who was reacting from Uyo, Akwa Ibom State, on Tuesday, said the results show a clear indication of recovery as the Nigerian economy continues to post signs of improvement.
These results, he added, reflect the Buhari administration’s continued implementation of targeted policies, programmes and projects across various MDAs and other sectors of the economy as set out in the ERGP. “Adherence to the ERGP has resulted in the economy coming out of recession and heading towards sustainable economic growth,” he said.
At the Dialogue Session on Nigeria’s Economy organized by Deloitte in Lagos penultimate Thursday, the Minister had indicated that with the policy actions of the Buhari Administration in the last three years and the sustained implementation of the ERGP, the Nigerian economy will continue to maintain its recovery and increase its growth trajectory in 2019.
He had told the participants at the dialogue that though the growth performance is still not where we would like it to be, the direction of growth indicates a positive momentum, especially with regard to the non-oil sector. “Our aim is to take all measures necessary to ensure that we increase the growth rate whilst maintaining fiscal sustainability”, he had stated.
The 2018 fourth quarter GDP result reinforces the Minister’s position as it shows a 0.57% increase over the 1.81% real GDP figure posted in the third quarter of the year and indicates a stronger growth level than the 2.35% which the Buhari administration inherited in the second quarter of 2015. These numbers, released in accordance with the NBS Release Calendar, are the final quarter and 2018 full year figures.
According to the NBS report, real GDP grew by 2.38% in Q4 2018 compared to 1.81% in Q3 2018 and 1.17% in Q3 2017. For the full year 2018, real GDP growth stood at 1.93%, higher than the 0.82% achieved in 2017.
The report further shows that the growth was driven by the non-oil sector in Q4 2018, up from 2.32% in Q3 2018; 2.05% in Q2 2018 and 0.76 in Q1 2018. This also compares favourably with -0.33% in Q4 2016 and 1.45% in the corresponding quarter in 2017. For the full year 2018, it indicates that the non-oil sector stood at 2.0% as against 0.47% in 2017.
A further breakdown of the non-oil sector shows that the Q4 growth was driven by Transportation which grew by 9.48% (13.91% for 2018), the Construction sector by 2.05% (2.33% for 2018) and Electricity by 0.95% (7.30% for 2018). These three sectors form major parts of the infrastructure component of the ERGP, which has been one of the priority areas of the Buhari administration.
Other non-oil sectors that drove growth in Q4 2018 include Telecommunications (16.67%), Agriculture (2.46%) and Quarrying and other minerals (20.9%). There was also strong growth recorded in the Manufacturing sector which grew by 2.35% compared to 1.92% in Q3 2018 and 0.14% in Q4 2017.”
While the non-oil sector drove GDP growth in Q4 2018, the oil sector slowed down with Crude oil and Gas GDP contracting by -1.62%, compared to -2.91%in Q3 2018. Industry performed better as it grew by 0.95% compared to -0.11% in Q3 2018.
The report also indicated that Services GDP growth recorded its best performance in 11 quarters, growing by 2.90% in Q4 2018 compared to 2.64% in Q3 2018. While growth in the economy was moderated by the contraction in the oil sector, 39 out of 46 economic activities recorded positive growth in Q4 2018.
The Minister while reviewing the growth performance observed that the encouraging result in GDP growth is also consistent with improvements in other indicators including inflation, foreign reserves, exchange rates, trade balance and capital inflows, amongst others.
The Minister was therefore happy and most encouraged as these indices show an economy that is on the mend and on the path of recovery to sustained growth. “It is a clear indication that our programmes and policies are on the right track,” he added.
Special adviser to the Hon. Minister