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Official data show that Nigeria’s economy grew slower last year compared to 2021. “Although the agriculture sector grew by 2.05 percent in…
Official data show that Nigeria’s economy grew slower last year compared to 2021. “Although the agriculture sector grew by 2.05 percent in the reference period, its performance was significantly hampered by severe incidences of flood experienced across the country, accounting for lesser growth,” it said. The agric sector’s GDP growth rate slowed to 1.88 percent in 2022 from 2.13 percent in 2021, while industry contracted further to 4.62 percent last year from 0.47 percent. The services sector expanded to 6.66 percent from 5.61 percent.
Following the pandemic-induced recession in 2020, Nigeria’s growth continued its positive trajectory through the first three quarters of 2022 on the strength of non-oil sector expansion while combating a shrinking oil sector as the country struggled to meet its OPEC commitments. Unfortunately, in Q4, growth slowed as some segments of the non-oil sector, chiefly agriculture, struggled, and continued weakness in the oil sector slipped into the broader economy. The numbers highlight the struggles of both of the affected sectors with the major problems the nation is currently facing, including increased insecurity that has affected farmers, food storage issues, the inability to transport some food products across the country, electrical problems, rising fuel prices, concerns about inflation, forex scarcity and multiple taxations, just to name a few. These problems have persisted over time, and their effects are still felt in how both economic sectors perform. We anticipate that the results for the upcoming quarter will be worse. Basically, government spending has been shrinking as revenues have been directed at debt payment, and the rising debt-to-revenue ratio is one of several factors scaring away foreign direct investors. The incoming administration inherits multifaceted challenges across all sectors of the Nigerian economy and will require strategic solutions and smart implementation to wade through the morass. It has its work cut out.