Nigeria's economy grew faster than expected in the fourth quarter as the oil sector ended more than three years of contraction.
Gross domestic product (GDP) grew at an annual rate of 3.46% in the three months to December, compared with a 2.54% rise in the previous quarter, data released by the Office for National Statistics on Thursday showed. The median forecast of six economists polled by Bloomberg was 2.4%.
advertisement
Continue reading below
In the oil sector, production increased to 1.55 million barrels per day from 1.34 million barrels per day in the same period last year, an increase of 12.1%. Petroleum Minister Heineken Lokpovili told Bloomberg TV in Davos last month. The country has not met its OPEC quota for years, but the minister expects this to change. He expects production to exceed quota by the end of the year.
The non-oil sector grew by 3.07% year-on-year, compared with 2.75% in the previous three months.
The better-than-expected performance was a big boost for Nigeria's President Bola Tinubu. Since taking office in May, the president has implemented a number of reforms to attract investment and revive the economy, which has been in the doldrums for nearly a decade. The Tinubu administration is targeting a growth rate of about 3.8% in 2024 and more than 6% in the next few years. The last time it achieved the latter ratio was in 2014. Last year, Nigeria Economic Summit Group Chairman Olaniyi Yusuf said Tinubu's growth targets were achievable if the energy sector strengthened.
Reforms implemented so far include abolishing heavy fuel subsidies, easing the exchange rate regime, and overhauling the tax system to increase revenue.
The economic growth rate in 2023 has slowed to 2.7% from 3.1% the previous year.
© 2024 Bloomberg