Nigerian Economy Grew 3.84 Per Cent in Last Quarter of 2024
The Nigerian domestic economy recorded a significant growth in the fourth quarter of 2024, expanding by 3.84% to reach N22.61 trillion, according to the Central Bank of Nigeria (CBN).
This growth is attributed to the improved performance of the non-oil sector, particularly the financial and insurance subsectors.
The CBN’s Q4 2024 Economic Report reveals that all real sector economic activities experienced broad-based growth, except for the electricity, gas, steam, and air conditioning subsector, which declined by 5.05%. The downturn in this segment is largely due to increased tariffs, ongoing grid maintenance, and a rising shift towards alternative energy sources.
The oil sector experienced a slower growth rate of 1.48% year-on-year compared to 3.96% in the non-oil sector. The apex bank noted that this deceleration was primarily attributed to a decline in the price of Nigeria’s Bonny Light crude, which fell to
75.66perbarrelfrom82.23 per barrel in Q3 2024. However, an increase in crude oil production from 1.33 million barrels per day (mbpd) to 1.43 mbpd helped to moderate the slowdown in the sector.
The non-oil sector continued its upward trajectory, expanding at a faster pace of 3.96% compared to 3.37% in Q3 2024. This sector contributed 3.77 percentage points to overall economic growth, making it the primary driver of Nigeria’s economic expansion. Key subsectors that fueled this growth include financial and insurance, information and communication, transportation and storage, crop production, and trade.
The financial and insurance subsector, in particular, witnessed significant growth due to increased financial technology adoption, improved banking penetration, and higher investment inflows into the capital markets. Similarly, the information and communication sector benefited from the continued expansion of digital services and increased internet penetration.
The transportation and storage sector also played a pivotal role in economic expansion, driven by increased logistics activities, trade facilitation, and government investments in infrastructure projects. Additionally, crop production remained robust, supported by favourable weather conditions and sustained agricultural interventions by the government.
Despite the positive economic trajectory, the electricity and gas subsector’s contraction highlights the ongoing challenges in Nigeria’s energy sector. Analysts suggest that addressing infrastructure deficits and enhancing power generation capacity will be crucial in sustaining long-term economic growth.
The CBN projects that continued policy interventions in critical sectors, improved investor confidence, and stability in the exchange rate will support further economic expansion in 2025. However, external risks such as fluctuations in global crude oil prices and inflationary pressures could pose challenges to growth momentum.
The latest GDP figures released by the National Bureau of Statistics (NBS) reveal that Nigeria’s economy grew by 3.84% year-on-year in real terms in the fourth quarter of 2024. The data shows that the growth was largely driven by the Services sector, which expanded by 5.37% and contributed 57.38% to the country’s total GDP.
As the Nigerian economy continues to grow, experts are optimistic about the country’s economic prospects in 2025. However, they caution that addressing the challenges in the energy sector and managing external risks will be crucial in sustaining long-term economic growth.
As the Nigerian economy continues to grow, it is expected that the government and the CBN will continue to implement policies that support economic growth, improve investor confidence, and enhance the business environment. With the challenges in the energy sector and external risks being addressed, Nigeria’s economic prospects in 2025 look promising.
