The persistent increase in the rate of inflation in Nigeria and the drop in crude oil production caused by oil theft and pipeline vandalism have led to a decline in the Gross Domestic Product growth rate in the second quarter of this year.
The National Bureau of Statistics in its second quarter GDP report stated that Nigeria’s economy grew 3.54 per cent in the second quarter, slower than the 5.01 per cent recorded in the same period a year earlier.
The NBS in the report released on Friday and made available to THE WHISTLER showed that the 3.54 per cent GDP represents a decline when compared to the 5.01 per cent in the second quarter of 2021.
The second quarter of last year, GDP growth rate of 5.01 per cent occurred following the negative impact of the COVID-19 pandemic on the Nigerian economy.
Nigeria’s inflation as of July this year stood at 19.64 per cent and it is the highest in the last 17 years.
The last time Nigeria’s inflation was above 19.64 per cent was in September 2005 when it rose to 24.32 per cent.
The uptick in the inflation rate was driven by increases in the food and core index.
Further breakdown of the report shows that the urban inflation rate rose by 2.08 per cent to 20.09 per cent in July 2022 from 18.01 per cent recorded in July 2021, while the rural inflation rate hit 19.22 per cent from 16.75 per cent recorded in the corresponding period of 202
While the country is battling with increasing inflation, the theft of crude oil and pipeline vandalism has been affecting crude oil revenue.
Nigeria is losing 400,000 barrels per day to crude theft, the Minister of State Petroleum, Timipre Sylva had said.
Within a three months period covering January 1 and March 31 this year, Nigeria lost a whopping amount of $1bn revenue to crude oil theft.
The NBS in its report stated that Africa’s top oil producer recorded an average daily oil production of 1.43 million barrels per day in the second quarter of this year, lower than the daily average production of 1.61 mbpd recorded in the same quarter of 2021.
The report stated, ” Nigeria’s Gross Domestic Product (GDP) grew by 3.54 per cent(year-on-year) in real terms in the second quarter of 2022. This growth rate declined from 5.01 per cent in the second quarter of 2021 when rapid growth was recorded following the toll the COVID-19 pandemic exacted on the economy in Q2 2020.
“In addition, the recent rising prices have adversely impacted on the second quarter 2022 performance. The Q2 2022 growth rate decreased by 1.4 per cent points from 5.01 per cent growth rate recorded in Q2 2021 and increased by 0.44 per cent points relative to 3.11 per cent in Q1 2022.
“However, quarter-on-quarter, real GDP grew at -0.37 per cent in Q2 2022, reflecting lower economic activity in Q2 2022 than in the preceding quarter.”
In the quarter under review, the NBS report stated that aggregate GDP stood at N45trn in nominal terms. This performance is higher when compared to the second quarter of 2021 which recorded aggregate GDP of N39.12trn indicating a year-on-year nominal growth rate of 15.03 per cent.
“The nominal GDP growth rate in Q2 2022 was higher relative to the 14.99 per cent growth recorded in the second quarter of 2021 and higher compared to the 13.25 per cent growth recorded in the preceding quarter,” it added.