Nigeria’s GDP Growth Slowed To 1.95%

The nation’s growth in Gross Domestic Product slowed to 1.95 per cent between January and March of this year due to weaker output from agriculture and other parts of the non-oil economy.

According to a Bloomberg survey, the 1.95 per cent was less than the 2.6 per cent median estimate.

The output of crude, which accounts for only about 10 per cent of the GDP, but generates the bulk of government revenue, rose to two million barrels a day in the period, the most since the first quarter of 2016.

The GDP contracted in 2016 for the first time in a quarter century, as the price and output of oil plunged.

Lawmakers on May 17 approved a 2018 budget of N9.1tn ($25bn), the biggest yet, with money being earmarked for investments in roads, rail, ports and power.

Nigeria’s government insists the economy of Africa’s biggest crude producer is on track to expand by 3.5 per cent this year due to increased oil revenue, even as growth missed expectations in the first quarter.

“There was a slowdown on seasonal effects, but what strikes you is that oil is big,” the Special Economic Adviser to President Muhammadu Buhari, Adeyemi Dideolu, said on Wednesday in an interview in Abuja.

“It gives you the means by which you can actually ramp up growth because you’re getting a bit more revenue; you’re getting a bit more forex,” he said.

The government’s projection exceeds that of the International Monetary Fund, which forecasts growth will accelerate to 2.1 per cent this year from 0.8 per cent in 2017.

The spending on capital projects will help spur growth, according to Dipeolu.

“Once the budget is signed, there will be economic activity just on the basis of implementation,” he said.