Economy
Nigeria’s GDP grows by 1.95% Q1 2018, non-oil sector accounts for 90.3%
The value of the goods and services produced in Nigeria in the first three months of 2018 rose by 1.95 per cent according to the National Bureau of Statistics NBS. This implies that Nigeria’s economic growth slowed in the first quarter of 2018 for the first time since the country pulled out of recession last year as the non-oil sector led the growth. The economy grew by 1.95 percent in the first quarter lifted by the non oil sector. That was a slight dip from 2.11 percent year-on-year in the final quarter of 2017. The economy shrank 0.91 percent in the first quarter of 2017.
Growth rates had been bouncing back since the third quarter of 2016, when the recession, its first in 25 years, bottomed out. Nigeria exited that contraction last year largely due to higher oil prices, with the country relying on crude sales for around two-thirds of government revenue. In the first three months of 2018, aggregate goods and services produced in the economy (GDP) stood at N28.464322 trillion in nominal terms. According top NBS “This performance is higher when compared to the first quarter of 2017 which recorded a nominal GDP aggregate of N26.028,356 trillion thus, presenting a positive year on year nominal growth rate of 9.36 per cent. This rate of growth is however lower relative to growth recorded in Q1 2017 by –7.70 per cent at 17.06 per cent but higher than the proceeding quarter by 2.14 per cent at 7.22 per cent.
“To give a clearer depiction, the Nigerian economy has been classified broadly into the oil and non-oil sectors. The Information and Communication sector which is composed of the four activities of Telecommunications and Information Services; Publishing; Motion Picture, Sound Recording and Music Production; and Broadcasting recorded impressive result within the quarter. In nominal terms, the first quarter of 2018 saw the sector grow by 1.79 per cent (year-on-year), a 7.25 per cent decrease from the rate of 9.04 per cent recorded in the same quarter of 2017. However, it is 2.34 per cent higher than rate recorded in the preceding quarter. The Quarter on Quarter growth rate was –3.58 per cent. The Information and Communications sector contributed 10.64 per cent to total Nominal GDP in the 2018 first quarter, lower than the rate of 11.43 per cent recorded in the same quarter of 2017 but higher than the 10.04 per cent it contributed in the preceding quarter. The sector in the first quarter of 2018 recorded a growth rate of 1.58 per cent in real terms, year on year. From the rate recorded in the corresponding period of 2017, there was a decline by 1.15 per cent Quarter on Quarter, the sector exhibited a growth of –4.15% in real terms. Of total real GDP, the sector contributed 12.41 per cent in 2018 first quarter, lower than in the same quarter of the previous year in which it represented 12.46 per cent but higher than the preceding quarter, in which it represented 11.35 per cent”.
According to NBS “Nominal growth in the Arts, Entertainment and Recreation sector was 0.41 per cent in first quarter 2018 (year-on-year), representing a decrease of 21.06 per cent relative to the same period a year earlier, and a decrease of 3.76 per cent compared with the preceding quarter. On a quarterly basis, growth was recorded at 31.51 per cent, higher than quarter-on-quarter growth of Q4 2017 recorded at 9.54 per cent. The activity contributed 0.28 per cent to total nominal GDP in first quarter 2018, lower than the 0.31% it contributed in Q1 2017 and higher than 0.20% it contributed in fourth quarter of 2017. In real terms, the activity grew by 0.30 per cent year on year, which was lower than the rate recorded in Q1 2017 by 11.37 per cent, and lower by 3.24 per cent when compared with that of the preceding quarter. Quarter on Quarter, growth stood at 31.51 per cent in real terms, higher than quarter-on-quarter growth recorded in Q4 2017 at 9.54 per cent.
In the period under review, the nation recorded an average daily oil production of 2.0 million barrels per day (mbpd), higher than the daily average production recorded in the fourth quarter of 2017 by 0.05 mbpd. Real growth of the oil sector was 14.77 per cent (year-on-year) in Q1 2018. This represents an increase of 30.37 per cent points relative to rate recorded in the corresponding quarter of 2017. Quarter-on-Quarter, the oil sector grew by 13.24 per cent in Q1 2018. The Oil sector contributed 9.61 per cent to total real GDP in Q1 2018, up from 8.53 per cent and 7.35 per cent recorded in the Q1 2017 and Q4 2017, respectively.
In comparison, non-oil sector grew by 0.76 per cent in real terms during the quarter under review. This was higher by 0.04 per cent point compared to the rate recorded same quarter of 2017 and 0.70 per cent point lower than the fourth quarter of 2017. The report stated the sector’s growth was driven mainly by agriculture (Crop production), financial institutions and insurance, manufacturing, transportation and storage as well as information and Communication. In real terms, the Non-Oil sector contributed 90.39 per cent to the nation’s GDP, lower than 91.47 per cent recorded in the first quarter of 2017 and 92.65 per cent recorded in the fourth quarter of 2017.
The Arab Africa Trade Bridges (AATB) Program and the Federal Republic of Nigeria formalized a partnership with the signing of the AATB Membership Agreement, officially welcoming Nigeria as the Program’s newest member country. The signing ceremony took place in Abuja on the sidelines of the 5th AATB Board of Governors Meeting, hosted by the Federal Government of Nigeria.
The Membership Agreement was signed by Eng. Adeeb Y. Al Aama, the CEO of the International Islamic Trade Finance Corporation (ITFC) and AATB Program Secretary General, and H.E. Mr. Wale Edun, Minister of Finance and Coordinating Minister of the Economy, Federal Republic of Nigeria. The Agreement will provide a strategic and operational framework to support Nigeria’s efforts in trade competitiveness, promote export diversification, strengthen priority value chains, and advance capacity-building efforts in line with national development priorities. Areas of collaboration will include trade promotion, agribusiness modernization, SME development, businessmen missions, trade facilitation, logistics efficiency, and digital trade readiness.
The Honourable Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, called for deeper trade collaboration between African and Arab nations, stressing the importance of value-added Agribusiness and industrial partnerships for regional growth. Speaking in Abuja at the Agribusiness Matchmaking Forum ahead of the AATB Board of Governors Meeting, the Minister said the shifting global economy makes it essential for African and Arab nations to rely more on regional cooperation, investment and shared markets.
He highlighted projections showing Arab-Africa trade could grow by more than US$37 billion in the next three years and urged partners to prioritize value addition rather than raw commodity exports. He noted that Nigeria’s growing industrial base and upcoming National Single Window reforms will support efficiency, investment and private-sector expansion.
“This is a moment to turn opportunity into action”, he said. “By working together, we can build stronger value chains, create jobs and support prosperity across our regions”, Edun emphasized. “As African and Arab nations embark on this journey of deeper trade collaboration, the potential for growth and development is vast. With a shared vision and commitment to value-added partnerships, we can unlock new opportunities, drive economic growth, and create a brighter future for our people.”
Speaking during the event, Eng. Adeeb Y. Al Aama, Chief Executive Officer of ITFC and Secretary General of the AATB Program, stated: “We are pleased to welcome Nigeria to be part of the AATB Program. Nigeria stands as one of Africa’s most dynamic and resilient economies in Africa, with a rapidly expanding private sector and strong potential across agribusiness, energy, manufacturing, and digital industries. Through this Membership Agreement, we look forward to collaborating closely with Nigerian institutions to strengthen value chains, expand regional market access, enhance trade finance and investment opportunities, and support the country’s development priorities.”
The signing of this Agreement underscores AATB’s continued engagement with African countries and its evolving portfolio of programs supporting trade and investment. In recent years, AATB has worked on initiatives across agribusiness, textiles, logistics, digital trade, export readiness under the AfCFTA framework, and other regional initiatives such as the Common African Agro-Parks (CAAPs) Programme.
With Nigeria’s accession, the AATB Program extends it’s presence in the region and adds a key partner working toward advancing trade-led development and fostering inclusive economic growth.
Federal Executive Council (FEC) has approved the 2026–2028 Medium-Term Expenditure Framework (MTEF), a key fiscal document that outlines Nigeria’s revenue expectations, macroeconomic assumptions, and spending priorities for the next three years. The approval followed Wednesday’s FEC meeting presided over by President Bola Tinubu at the State House, Abuja. The Minister of Budget and Economic Planning, Senator Atiku Bagudu made this known after the meeting.
The Minister said the Federal Government is projecting a total revenue inflow of N34.33 trillion in 2026, including N4.98 trillion expected from government-owned enterprises. Bagudu said that the projected revenue is N6.55 trillion lower than earlier estimates, adding that federal allocations are expected to drop by about N9.4 trillion, representing a 16% decline compared to the 2025 budget.
He said that statutory transfers are expected to amount to about N3 trillion within the same fiscal year. On macroeconomic assumptions, FEC adopted an oil production benchmark of 2.6 million barrels per day (mbpd) for 2026, although a more conservative 1.8 mbpd will be used for budgeting purposes. An oil price benchmark of $64 per barrel and an exchange rate of N1,512 per dollar were also approved.
Bagudu said the exchange rate assumption reflects projections tied to economic and political developments ahead of the 2027 general elections. He said the exchange rate assumption took into account the fiscal outlook ahead of the 2027 general elections.
The minister said that all the parameters were based on macroeconomic analysis by the Budget Office and other relevant agencies. Bagudu said FEC also reviewed comments from cabinet members before approving the Medium-Term Fiscal Expenditure Ceiling (MFTEC), which sets expenditure limits. Earlier, the Senate approved the external borrowing plan of $21.5 billion presented by President Tinubu for consideration The loans, according to the Senate, were part of the MTEF and Fiscal Strategy Paper (FSP) for the 2025 budget.
The spot rate on Nigerian Treasury bills has been increased by 146 basis points by the Central Bank of Nigeria (CBN) following tight subscription levels at the main auction on Wednesday. The spot rate on Treasury bills with one-year maturity has now surpassed Nigeria’s 16.05% inflation by 145 basis points following a recent decision to keep the policy rate at 27%.
The Apex Bank came to the primary market with N700 billion Treasury bills offer size across standard tenors, including 91-day, 182-day and 364 day maturities. Details from the auction results showed that demand settled slightly above the total offers as investors began to seek higher returns on naira assets despite disinflation.
Total subscription came in at about N775 billion versus N700 billion offers floated at the main auction. The results showed rising appetite for duration as investors parked about 90% of their bids on Nigerian Treasury bills with 364 days maturity. The CBN opened N100 billion worth of 91 days bills for subscription, but the offer received underwhelming bids totalling N44.17 billion.
The CBN allotted N42.80 billion for the short-term instrument at the spot rate of 15.30%, the same as the previous auction. Total demand for 182 days Nigerian Treasury bills settled at N33.38 billion as against N150 billion that the authority pushed out for subscription. The CBN raised N30.36 billion from 182 days bills allotted to investors at the spot rate of 15.50%, the same as the previous auction.
Investors staked N697.29 billion on N450 billion in 364-day Treasury bills that was offered for subscription. The CBN raised N636.46 billion from the longest tenor at the spot rate of 17.50%, up from 16.04% at the previous auction.
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