Nigeria's economy grows by 6.56% in first quarter

Indications that Nigeria's Real Gross Domestic Product (GDP), the key indicator of economic growth, has nudged up to  6.56 per cent in the first quarter of this year from 6.34 per cent it attained in the corresponding quarter of 2012,  according to the 2012 estimate for Q1, 2013 GDP for the country published by the National Bureau of Statistics (NBS) in Abuja on Thursday.

Also,  the nominal GDP for the quarter was N37 billion better than the figure in the corresponding period of 2012. It came in at N9.49 trillion, as against the N9.14 trillion in the corresponding quarter of 2012.

However, the GDP  figure was shy of  the growth rate of 6.99 per cent recorded in the fourth quarter of 2012.

According to the report, the non-oil sector growth was driven by growth in activities in building and construction, hotels and restaurants, real estate services, manufacturing, finance and insurance and solid minerals, amongst other sectors of the economy.

For the oil sector,  the report indicated that output decreased in the first quarter of 2013 relative to the corresponding quarter of last year.

The agency specifically reported that the oil sector recorded an average daily production of 2.29 million barrels per day in the first quarter of 2013 as against 2.35 million barrels per day in the corresponding quarter in 2012, adding that the figures with their associated gas components, resulted in a growth rate, in real terms of -0.54 per cent in oil GDP in the quarter under review compared with the -2.32 per cent for the corresponding period in 2012.

While noting that the sector witnessed series of operational disruptions in the upstream sector of the oil and gas industry, NBS pointed out that sector still accounted for about 14.75 per cent of real GDP in the first quarter 2013, compared to 15.80 per cent contribution in the first quarter of 2012 and 12.59 per cent in Q4, 2012.

On the non-oil sector performance, the Bureau reported that the sector continued 'to be a major driver of the economy in the first quarter of 2013 when compared with the corresponding quarter in 2012.'

Amplifying further, it stated: 'The sector recorded 7.89 per cent growth in real terms in the first quarter of 2013 compared with 8.14 percent in the corresponding period of 2012. The growth in the non-oil sector however declined in the first quarter of 2013 when compared with the corresponding quarter of 2012. The relative decline in growth can be seen in such activities as agriculture, telecommunications and wholesale and retail trade.'

Meanwhile, after decreasing to all-time lowest level of 8.6 per cent in five years by last March, the nation's Composite Price Index, CPI, which measures the average change in price level in the economy rose to 9.1 per cent in April, being the fourth consecutive month it is sustaining a single digit year-on-year rates.

According to the CPI report by NBS, relative to March, the rise in the headline index could be primarily attributed to higher price levels of food products due to the effect of declining inventories.

The Bureau reported further that as in March, the core sub-index exhibited a muted rise due to base effects, adding that between March 2012 and December 2012, the core sub-index recorded substantial year-onyear price increases, representing an average of 14.2 per cent compared to 11.8 per cent over the same period in the preceding year.

The implications of these trends, according to the agency, are that the year-on-year changes for this year are likely to be lower due to substantially higher price levels in 2012.

The statistical agency also observed generally slower rises in monthly prices since 2013, a healthy development, which it stated may be connected to more prudent fiscal measures together with the tight monetary policy stance being maintained by the Central Bank of Nigeria government over the past two years

Expatiating further on the inflation rate as it relates to its 'All Items index' trend, the NBS reported that in April, the composite CPI increased by 0.55 per cent from index levels recorded in March, with the Urban composite CPI recorded at 143.7 in the month under review, indicating a 9.7 per cent yearon- year change. This was higher than the 9.3 per cent recorded in March.

According to the agency, the corresponding Rural National CPI recorded an 8.9 per cent year-on-year change, up from 8.1 per cent in March, adding that on a month-on-month basis, the Urban All-item index increased by 0.6 per cent in the month under review compared with the 0.6 recorded in the preceding month. The Rural All Items index increased from levels recorded in March by 0.8 per cent. The percentage change in the average Composite CPI for the 12-month period ending in April 2013 over the average of the CPI for the previous twelvemonth period was recorded at 11.1 per cent.

A further analysis of the inflation rate indicated that the composite Food Index increased year-on-year by 10.0 per cent to 145.6 points, representing 0.5 percentage points higher than the 9.5 per cent recorded in the preceding month while on a month-on-month basis, the index increased by 0.6 per cent between March and April.