The National Bureau of Statistics (NBS) on Monday said that the country’s Gross Domestic Product (GDP) rose by 6.48 per cent in the third quarter of 2012. A statement issued in Abuja by Dr Yemi Kale, the Statistician-General of the Federation, indicated that the figure was lower than the 7.37 per cent recorded in the corresponding period in 2011.
Kale said that the nominal GDP for the third quarter of 2012 was estimated at N10.9 trillion, compared with the N9.8 trillion of the corresponding quarter of 2011. “The economy, comprising two broad output groups of oil and non-oil sectors, witnessed slower growth output in the third quarter of 2012 as a result of declines in non-oil sector output.
“While the oil sector witnessed positive growth for the first time in four quarters, the slower non-oil sector growth was driven by growth in activities recorded in the building and construction, cement, hotel and restaurant, as well as the electricity sectors,’’ the statement said. Quoting NNPC data, the statement said that the country’s average daily crude oil production stood at N2.52 Million Barrels Per Day (MBPD) in the third quarter of 2012, compared with the 2.38 MBPD in the corresponding quarter of 2011.
It said that these figures, with their associated gas components, resulted in a growth rate in real terms of 0.08 per cent in oil GDP in the third quarter of 2012, compared with the -0.26 per cent in the corresponding period in 2011.
“During the period, activities of vandals and oil theft decreased as a result of intensified surveillance instituted by government in the oil producing areas. Moreover, re-entry into previously abandoned fields by some oil majors and renewed production there was responsible for the slight improvement in oil GDP during the period under review,’’ the statement said. It said the oil sector also benefited from the relative stability in international crude oil market price and the exchange rate of the naira to the dollar during the third quarter of 2012.
“While oil sector contribution to real GDP in the third quarter of 2011 was 14.28 per cent, this declined to 13.42 per cent in the third quarter of 2012,’’ the statement said.
It said that the non-oil sector recorded 7.55 per cent growth in real terms in the third quarter of 2012, compared with 8.76 per cent recorded in the corresponding period of 2011. It pointed out that growth in the non-oil sector decreased in the third quarter of 2012, when compared with the figure in the corresponding quarter of 2011. “This decline was largely attributed to declines in output in the agriculture, telecommunications, wholesale and retail trade and real estate sectors. The performance of the major industries in the non-oil sector in the third quarter of 2012 is further analysed to give a better understanding of their contributions to the Nigerian economy.
“Crops produced in Nigeria are classified broadly as vegetables, root crops, cereals, leguminous and cash crops,’’ the statement said. It said that in terms of output, the real agricultural GDP growth rate in the third quarter of 2012 stood at 3.89 per cent against 5.76 per cent in the corresponding period of 2011. In addition to the prevailing (though gradually improving) security challenges facing most agricultural producing states in Northern Nigeria, growth in the sector was also partially affected by floods. This is affecting several states across the country to varying degrees.
“However, due to the fact that the peak of the flooding was toward the end of the third quarter, the impact on agricultural production was less observed during the quarter. It is conceivable that the full impact of the floods will be more visible in the fourth quarter of 2012 and the first quarter of 2012. NBS’ preliminary analysis suggests that the impact of flooding on agricultural GDP may not be as severe as feared. This is because agriculture in Nigeria is such that each crop type has a different gestation period and prevalence in each state, leading to different harvesting periods in different parts of the country,’’ the NBS statement said.
It quoted the National Emergency Management Agency (NEMA) as indicating that the most affected states were Adamawa, Anambra, Bauchi, Bayelsa, Benue, Cross River, Delta, Edo, Imo, Jigawa, Kaduna, Kano, Kogi, Nasarawa, Niger, Taraba and Plateau. Others that experienced relatively lower levels of flooding were Abia, Ebonyi and Rivers.
“Although some of the affected states are known for the production of crops with significant contributions to crop production GDP in Nigeria, it should be noted that not all parts of these states were inundated by the floods.’’ The bureau said that some of the crops were also grown in several parts of the country other than the states that experienced floods.
“As can be seen from the Socio Economic Survey conducted by NBS in 2011, such crops include cassava, yam and maize which contribute 36.49 per cent, 27.22 per cent and 6.95 per cent to crop production GDP, respectively. Cotton (5.89 per cent), guinea corn (5.74 per cent), millet (4.72 per cent), rice (3.48 per cent) and groundnut (3.08 per cent) are other examples of such crops, though with lesser contributions to crop production GDP,’’ the statement said. It said further analysis indicated that cassava-producing states, which were affected by the floods, contributed 63.59 per cent to the national cassava production, even though as noted earlier, not all parts of these states were damaged by the floods.
“Similarly, 70.55 per cent of national yam production, 71.72 per cent of maize production, 79.42 per cent of rice production and 67.81 per cent of groundnut production can be accounted for by the affected states. These percentages represent the proportion of crop production that would be lost if the entirety of states producing these crops were no longer available for agricultural activity. As this was not the case, the observed growth in agricultural GDP in Q3 reflects the moderated effects of the flood on real GDP growth,’’ the statement said.
It said that the NBS was working with partner agencies to determine more precisely the socio-economic impacts of the floods. The statement said the finance and insurance sectors recorded a growth of 4.08 per cent in the third quarter of 2012, compared with the 4.04 per cent recorded in the same period in 2011. It said the increase in growth of the sector was traceable to the vibrancy in the financial sector, driven by increased lending activities by banks.
“It is also due to continued favourable investment yields in the bond market, which favoured key players in the industry, especially pension fund managers, banks and insurance firms.’’ The NBS statement said that the wholesale and retail trade sector recorded a real GDP growth of 9.62 per cent and a contribution of 18.81 per cent in the quarter under review as against 11.80 per cent growth and 18.27 per cent contribution to GDP recorded in the corresponding quarter of 2011. Thus, the sector recorded a decline in growth of 2.18 percentage points in Q3 2012 when compared with corresponding quarter in 2011.
“The decline is attributable to a number of factors such as the decline witnessed in related sectors like agriculture and other manufacturing. Nevertheless, the sector is still a major contributor to the Nigerian economy,’’ it said. The statement said the telecommunications sector recorded a real GDP growth of 31.57 per cent in the third quarter of 2012 as against 35.00 per cent recorded in the corresponding period of 2011.
It said the decline in growth recorded in the sector was attributable to the poor quality of service experienced during the quarter arising from the adverse weather conditions experienced across the country. “This sector, which used to suffer from an absence of competition and abuse of monopoly power, is now with alternative options for the consumers. This sector is playing pivotal role in the growth of many other sectors through its intensive marketing strategy and value added services. The data service is contributing tremendously to the growth of the sector.
“The performance of the telecommunications sector in the third quarter of 2012 compared with previous quarters,’’ the statement said. It said the real estate sector growth stood at 10.24 per cent in the third quarter of 2012 compared with 10.86 per cent in the corresponding period of 2011. The statement said that the sector was characterised by two major classes of properties – the low end and the high end.
“The low end comprise of places of low development which are driven by investments from individuals and few corporate bodies mostly in form of residential buildings. The high end comprises of those areas where aggressive and high valued investments into real estate properties are made.
According to the statement, the situation at the high end areas is a decreasing demand situation while investments from individuals and some corporate entities still trickle into the low end of the sector. It said during the third quarter of 2012, manufacturing activities improved for the second consecutive quarter although decreased relative to the same period in 2011.“It recorded a decrease in growth rate from 7.84 per cent in the third quarter of 2011 to 7.78 per cent in Q3 2012.
“The development is traceable to a number of factors which include: decline in agricultural production which plays important part in producing raw materials to this sector and challenges with the ease of accessing funds. Nevertheless, the relatively improving electricity supply situation in the country appears to be boosting the sector,’’ the statement said. The bureau said business and other services sector recorded a real GDP growth of 9.11 per cent in the third quarter of 2012 compared to 8.52 per cent recorded in the corresponding quarter of 2011. It said the increase in growth recorded in the third quarter of 2012 relative to its performance in the third quarter of 2011 in business and other services was traceable to the higher consumer demands.