Mr Muda Yusuf, Director-General, and Mr Babatunde Ruwase, President of the LCCI at a public function recently.
By John Okoh
The Lagos Chamber of Commerce and Industry, LCCI, has reacted to the latest 2018 Gross Domestic Product, GDP, released from the National Bureau of Statistics which revealed that Q4 2018 GDP numbers grew by 2.4 per cent compared to Q3 2018 growth of 1.8 per cent YoY, describing it as still weak.
“This growth mirrored the performance of the non-oil sector which improved by 2.7 % YoY. The full year GDP improved by 1.9% better than 2017 of 0.8%. This performance is still weak and fragile. It is also far below 3% annual population growth as this remain a cause for concern due to its wider impact on inclusive and sustainable growth in the country,” said the premier Chamber in the country in its LCCI GDP Alert, released on Friday.
Though the organization foresees a gradual growth, it however said the numbers do not tally with the expanding population couples with low purchasing power of the consumer because “sectors such as Trade, Manufacturing and Agriculture recorded low performance”.
Sectoral Contribution to Overall GDP 2018FY
In 2018, Crop production, Trade and Telecoms are the major contributors to overall GDP
Others are 27% :Tele. & Inform. Services 10%; Real Estate 6%; Crop Production 23%; Crude Petroleum & Natural Gas 9%; Manufacturing 9%; Trade 16%
Top Five Fastest and Deteriorating Sectors in 2018
Top five fast growing and declining sector in 2018 include;
Quarrying & Other Mining; 10%; Metal Ores; 30%; Air Transport 25%; Road Transport 20%; Tele. & Inform. Services 15%; Public Administration 0%; Motor Vehicles & Assembly -5%; Oil Refining -5%; Real Estate-10%; Coal Mining -10%
Key Sectoral Performance
Agriculture:
The sector expanded by 2.1% in 2018. This sector recorded the lowest growth since 1993. The major driver of this sector performance is Crop Production, which accounted for 88% of Agricultural output in 2018. In terms of contribution, Agriculture accounted for 25% of real output in the year.
Crude, Petroleum & Natural Gas
Average daily oil production stood at 1.91 million barrel per day in fourth quarter 2018. This was lower than the 1.95 MBPD recorded in same quarter 2017. The oil sector grew by 1.1% as against 4.69% recorded in 2017. This sector contributes 8.60 % in 2018
Manufacturing
The Manufacturing sector recorded an annual growth rate of 2.09% in 2018, this marks significant improvement of -0.21% in the previous year. This sector contributes about 9.20 % to overall GDP.
Trade
Trade sector contracted by -0.63 in 2018 from -1.05 % and -0.24% in 2016. The sector contributes 17.16% in 2018. The declining performance of this sector signifies that Nigerian consumers are still under severe pressure in terms of weak purchasing power, as trade is a major consumer- facing sector.
Telecoms
Telecommunication and Information services sector grew by 11.33% in 2018 from -2.04% in 2017 and 2.03% in 2016. This sector contributes about 10% to overall GDP
Conclusion
- The economy continues on a growth path. However, this growth is still weak, vulnerable and fragile.
- This growth is far below the country’s population growth of 3.0%, with wider implications for poverty, inclusive and sustainable growth.
- Sectors such as Trade, Manufacturing and Agriculture recorded low performance. This signifies weakness on the part of the consumers purchasing power.
- The growth in the economy is also tagged a “Jobless growth” as unemployment keep on rising. The latest report by poverty world clock also suggests that the number of extremely poor Nigerians has risen to 91.6 million.
- We suggest that policies and reforms that will attract investment into the key employment elastic sectors should be implemented.
