- Ranks denotes the growth change across 19 sectors in the last four years annually;
- Electricity, gas, steam and air conditioning supply sector was the most volatile;
- Information and Communication sector had the biggest jump in growth ranks;
- While the transportation sector recorded the biggest slump.
On Monday, the National Bureau of Statistics announced Nigeria’s Gross Domestic Product (GDP) decreased by -6.1% in the second quarter (Q2) of 2020. By implication, we might just be one quarter away from another economic recession; the last noteable downtrun being in 2016.
GDP figures are a measure of growth. If an economy is growing, then so is the volume of goods and services produced in that economy. It also gives an indicator on the health of a country’s economy. And for Nigeria, we are borderline ill, findings show. In fact, this would be the sixth time the economy has experienced a negative GDP growth rate since 1981. The timeline:
- 1982: -6.80%
- 1983: -10.93%
- 1984: -1.11%
- 1993: -2.04%
- 1994: -1.82%
- 1995: -0.08%
- 2016: -1.58%
- Q2 2020: -6.10%
For the second quarter of 2020, only 6 sectors experienced positive growth, leaving 13 sectors with negative growth, viz: mining and quarrying; manufacturing, electricity, gas, steam, construction, trade, accommodation & food service, transportation and storage, arts, entertainment and recreation, real estate. Others include professional, scientific, and administrative and support service, education and other services.
Worse, though, when you consider the consecutive quarter’s growth experienced in 2019, the picture becomes clear. In fact, the growth rate Nigeria experienced Q4 2019 remains the highest quarterly growth performance since the 2016 recession. Still, slow-recovery has always been the theme.
And while NBS attributes these negative growth trends in the second quarter to the pandemic and dip in oil prices, another theme lies hidden. A cursory look at the growth change across various sectors shows a trend of negative growths in most of the sectors for a period.
In view of the preceding, Dataphyte ranks 19 key economic sectors. The metric showcases their responses to economic trends in the last four years, basing the rating on annual GDP growth from 2016.
The top six sectors (GDP Growth Rates)
Agriculture
Highest GDP Growth: 4.11%
Best Rank year: 2016
Lowest Rank year: Q2 2020
Agriculture is one of the six sectors to have avoided falling into recession, posting a growth rate of 1.58 percent, albeit below the 2.36 percent growth rate in the first quarter of 2019 and 2020. Also, in 2017, the sector recorded a 3.45 percent growth rate; 2.12 percent in 2018.
Mining and Quarrying
Highest GDP Growth: 4.62%
Best Rank year: 2017
Lowest Rank year: 2016
This sector boasted a brilliant 2019 and first quarter of 2020, featuring 4.43 percent. It, however, experienced a drop in 2018 to 1.27 percent from 4.62 percent in 2017. Still, the latest growth rate makes for no good reading, giving that the sector plunged by 6 percent in 2020 second quarter. It is also interesting to note that the sector was the fastest expanding sector in 2017.
Manufacturing
Highest GDP Growth: 2.09%
Best Rank year: Q2 2020
Lowest Rank year: Q2 2020
The 2016 recession affected the manufacturing sector immensely, recording a negative growth rate of -4.32 percent. Also, in 2017, the sector recorded a -0.21 per cent rate. It, however, fared better in the years ensuing; in 2018, 2019, and Q1 2020, it recorded 2.09%, 0.77% and 0.77% GDP percentage increments. Again, the sector plunged back to recession by -8.78 percent in the second quarter of 2020. Yet, despite the recent negative growth, it moved up places to 10th from position 12 in 2016.
Electricity, gas, steam and air conditioning supply
Highest GDP Growth: 16.43%
Best Rank year: 2017
Lowest Rank year: 2016
One can best describe the growth trend for the electricity, gas, steam and air conditioning supply sector as anticlimactic. In 2017, it emerged with the highest growth rate (16.73 percent), simultaneously bagging the third best performing sector (7.30 percent). In contrast, 2019 saw a negative growth of 4.86 percent; a trend that recurred in Q2 2020 (-3.00 percent).
Transportation and storage
Highest GDP Growth: 13.91%
Best Rank year-2018
Lowest Rank year: Q2 2020
Transportation ranked second in 2020 with a 3.86 per cent annual growth rate, a trend that continued till last year, recording a 10.73% growth rate. However, the coronavirus and lockdown intervened, plunging the sector to unfathomable depths- last place in our assessment with a -49.23% rate in Q2 20202. Recall in 2017, it ranked second place.
Financial and insurance
Highest GDP Growth: 18.49%
Best Rank year: Q2 2020
Lowest Rank year: 2017
While other sectors struggled because of the pandemic, the financial and insurance sector recorded an impressive 18.49% growth rate in the second quarter. For context, it ranked 7th in 2017 with a measly 1.26 percent GDP growth rate.
Public Administration
Highest GDP Growth: 2.02
Best Rank year: 2020
Lowest Rank year: 2019
Since 2016, the Public administration sector has recorded consecutive negative growth (4.58% in 2016, -0.36 in 2017, -2.05% in 2018, -4.01 in 2019 and -4.01 Q2 2020). In the second quarter of 2020, however, it fared better, moving up to 4th place with a positive GDP rate of 2.02%. It previously occupied 18th place with a -0.38% rate.
A look at the changes
