Africa’s largest economy Nigeria grew at an impressive 4.03 percent rate year-on-year in the third quarter (Q3) of 2021 after posting 5.01 percent in the second quarter, according to the latest data published by the National Bureau of Statistics (NBS) on Friday.
Despite the high inflation rate and a series of weak economic fundamentals, Nigeria is showing strong resilience, especially when compared to the peak of COVID-19 when Gross Domestic Product (GDP) contracted by 6.10 percent and 3.62 percent in the second and third quarter of 2020, respectively.
The economy has since rebounded from recession with 0.11 percent, 0.51 percent, 5.01 percent and 4.03 percent growth rates in Q4 2020, Q1 2021, Q2 2021 and Q3 2021, respectively. Aggregate GDP rose to N45.113 trillion in nominal terms, representing a 15.41 percent year-on-year growth rate from N39.089 trillion achieved in the third quarter of 2020.
To better understand Nigerian economic composition, it is important to take into consideration productivity in the oil and non-oil sectors.
Nigeria’s crude oil production stood at 1.57 million barrels per day (mbpd) on average in the third quarter, lower than the daily average production of 1.67 mbpd achieved in the same quarter of 2020 but the country generated more revenue in Q3 2021 given the surged in oil prices in 2021.
Oil sector recorded -10.73 percent year-on-year real growth in the quarter under review, an increase of 3.16 percent points relative to the rate recorded in the corresponding quarter of 2020. Growth increased by 1.92 percent when compared to Q2 2021 which was –12.65 percent.
On a quarterly basis, the oil sector recorded a growth rate of 12.05 percent the quarter under review, while the sector contributed 7.49 percent to total real GDP, down from figures recorded in the corresponding period of 2020 and up compared to the preceding quarter, where it contributed 8.73 percent and 7.42 percent, respectively.
The Non-Oil Sector
The non-oil sector, Nigeria’s largest growing sector, grew by 5.44 percent in real terms in the third quarter of 2021. This rate was 7.95 percent higher than the rate recorded in the same quarter of 2020 and 1.30 percent lower than the second quarter of 2021.
The sector was largely driven by trade, Information and Communication (Telecommunication); other drivers include Financial and Insurance (Financial Institutions); Manufacturing (Food, Beverage & Tobacco); Agriculture (Crop Production); and Transportation and Storage (Road Transport), accounting for positive GDP growth.
In real terms, the Non-Oil sector contributed 92.51 percent to Nigeria’s GDP in the third quarter of 2021, lower than the 92.58 percent recorded in the second quarter of 2021 and higher than 91.27 percent posted in Q3 2020.
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Nigeria’s Presidential CNG Initiative Allocates N100bn for CNG Buses and EV Adoption
The Presidential Compressed Natural Gas (CNG) Initiative has allocated N100 billion to expedite the deployment of CNG buses nationwide, according to a statement released on Wednesday.
The initiative, designed to catalyze an Auto-gas and Electric Vehicle (EV) revolution in mass transit and transportation, aims to enhance sustainability and cost-effectiveness.
The statement revealed that the fund would be instrumental in supporting the adoption of auto-gas and electric vehicles, signaling a commitment to a more sustainable and economical future in the transportation sector.
The Presidential CNG Initiative plans to leverage over 11,500 CNG and electric-fueled vehicles, along with the deployment of 55,000 conversion kits.
This strategic approach is intended to reduce transportation costs for Nigerians and mitigate the challenges posed by the rising cost of living.
Under the Renewed Hope Agenda, the Presidential CNG Initiative is dedicated to realizing the President’s vision, guided by its steering committee led by FIRS Chairman Zacch Adedeji.
The statement highlighted recent achievements, including strategic technical partnerships and the ongoing commissioning of CNG Conversion centers in key states such as Lagos, Abuja, Kaduna, Ogun, and Rivers.
Several more centers are slated for commissioning in the coming weeks, reflecting the initiative’s momentum and commitment to achieving its objectives.
Nigeria’s Power Transformation: 53 Projects Worth N122bn on Track for May 2024 Completion
The Central Bank of Nigeria (CBN), in collaboration with the Transmission Company of Nigeria (TCN) and power distribution companies, is set to complete 53 power projects by May next year.
Valued at N122 billion, these projects aim to add over 1,000 megawatts to TCN’s wheeling capacity.
During a recent tour of three ongoing projects in Lagos, TCN’s Programme Coordinator, Mathew Ajibade, assured that the projects were not abandoned, refuting speculations.
He confirmed that work is progressing smoothly and is expected to be completed by May 2024, as initially planned.
Assistant Director/Head of Infrastructure Finance Office at the CBN, Tumba Tijani, highlighted the CBN’s support for the power sector, revealing that the bank released a loan at a 9% interest rate in August last year for the projects.
The funding, part of the Nigeria Electricity Market Stabilisation Facility-3, amounts to N122,289,344 and aims to address transmission/distribution bottlenecks, enhance supply to end-users, and unlock unutilized generation capacity.
Tijani disclosed that N85.43 billion has been disbursed into the Advance Payment Guarantee account of the 53 contractors responsible for executing the projects.
The comprehensive project list includes the delivery of power transformers, re-conductoring existing transmission lines, upgrading existing substations, and constructing 33KV line bays.
The initiative reflects a concerted effort to enhance Nigeria’s power infrastructure and meet growing energy demands.
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