INDUSTRY REVIEW: Nigeria’s top five performing sectors outside oil category in Q2 2022
Nigeria’s Gross Domestic Product (GDP) rose to 3.54% year-on-year in the second quarter of 2022, falling 1.47% below the 5.01% the economy grew in Q2 2021, due to the oil sector declining for two quarters consecutively.
Although, in terms of quarter-on-quarter growth, this year’s second quarter rate surpassed the 3.11% growth recorded between January to March, and the Nigerian economy has the non-oil sector to thank for the upward movement in GDP, according to figures obtained from the National Bureau of Statistics (NBS).
At the end of the second quarter of 2022, the country’s aggregate real gross domestic product value hit N17.29 trillion, which is N591.22 billion higher than the N16.69 trillion recorded in Q2 2021. However, it is N63.50 billion lower when compared to the N17.35 trillion reported in the first quarter of 2022.
The difference in value was as a result of the oil sector contracting 11.77% year-on-year in Q2 2022, as against the decrease of 26.04% recorded in the first half of 2022, previously reported by Ripples Nigeria, leaving Nigeria’s GDP to depend on the 4.77% growth of the non-oil sector to avoid a decline.
Best performing sectors in non-oil category
The list is compiled from the fifth to the highest growing sectors in the non-oil category.
However, note that the financial institutions, chemical and pharmaceutical products, Telecommunications and information services, insurance, as well as the food, beverage, and tobacco production failed to make the top five list, as they grew only slightly above 20%.
The Financial institutions grew 20.06%, Chemical and pharmaceutical products rose 9.29% during the period in review, Telecommunications and information services increased by 7.71%, Insurance was up 6.96%, while the Food, beverage, and tobacco production sector grew 5.11%.
The top five growing non-oil sectors in Q2 2022
1) Quarrying and other minerals – 22.15%
Quarrying and other minerals recorded a growth rate of 22.15% in the second quarter of this year to complete the top five highest growing sector of Q2, after reporting 13.72% contraction in the first quarter of 2022.
2) Air transport – 22.45%
With hike in flight tickets due to scarcity of aviation fuel and the cost of the product skyrocketing from about N200 per litre to as high as over N900 between fourth quarter 2021 and H1 this year, the aviation sector grew by 22.45% at the end of Q2 2022.
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Despite the domestic airlines gaining from the increased insecurity, as more road users began to use air transport to travel across Nigeria, the growth fell below the 50.68% increase reported in the first quarter.
3) Water supply and waste management – 23.73%
Nigeria’s water supply, sewage, and waste management sector grew by 23.73% during the period under review, surpassing the 13.22% recorded in the first quarter of 2022.
4) Coal mining – 36.06%
The coal mining sector recovered from the first quarter’s contraction of 12.97% to account for only 0.03% of the entire economy of the country after recording 36.06% year-on-year growth in real terms in the second quarter of 2022.
5) Road transport – 56.38%
Despite rising insecurity due to banditry, the road transport sector, which accounts for only 1.7% of the Nigerian economy, reported the highest growth in the non-oil category, rising 56.38% in the second quarter 2022.
With over 11.8 million licensed cars on Nigeria’s roads as at Q4 2018, the sector recovered from the 24.63% contraction reported in the first quarter of this year, but fell behind the 92.38% recorded in Q2 2022.
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