NBS Reports 3.89 Per Cent Q1 Growth
Nigeria’s economy sustained its slow climb out of stagnation during the first quarter of the year. Data released by the National Bureau of Statistics showed real gross domestic product expanded by 3.89 per cent year-on-year. This performance marks an improvement on the 3.13 per cent growth recorded during the same period last year. However, the numbers reveal a marginal slowdown from the 4.0 per cent expansion observed in the final quarter of last year. Local analysts view the output as proof of a fragile macroeconomic stabilization.
The non-oil sector remained the primary engine of economic expansion, contributing 96.08 per cent to total output. Services led the momentum by accounting for 57.75 per cent of the non-oil performance. Information and communications technology expanded by 10.98 per cent, while entertainment grew by 11.25 per cent. Notably, commerce emerged as a major bright spot. The trade sector became the single largest component of national output, commanding a 17.89 per cent share.
Improved foreign exchange liquidity and a stabler naira helped revive commercial activity. Easing inflationary pressures also boosted retail transactions and restored some business confidence. Yet, the high concentration of growth in commerce exposes severe systemic vulnerabilities. A healthy economic transformation requires stronger domestic production rather than mere trading. Deeper industrialisation and local value addition remain missing pieces in the current recovery.
The manufacturing sector grew by a modest 3.29 per cent during the quarter. While this beat the dismal 1.13 per cent growth from the preceding quarter, the sector still contributes less than a tenth of national output. Petroleum refining, food production, and cement manufacturing drove the meager recovery. Heavy industrial firms continue to struggle against prohibitive credit costs. High energy prices, structural logistics bottlenecks, and policy uncertainties also choke factory floors.
A severe contraction in the utility sector represents the most alarming detail of the state report. The electricity and gas segment shrank by 15.30 per cent during the three months. This represents the sharpest decline the power sector has experienced in recent years. Persistent failures in the generation, transmission, and distribution grid infrastructure caused the slump. Deep liquidity crises and poor corporate governance also paralyze the electricity value chain.
The energy collapse has forced domestic firms to rely heavily on expensive private generators. This dependency erodes industrial competitiveness and inflates the cost of local consumer goods. Rising operational expenses threaten to erase the marginal gains achieved through currency stability. Policymakers must now shift focus from broad macroeconomic numbers to fixing specific structural defects. Without robust power and factories, growth will fail to improve everyday living standards.