CPPE Statement on Nigeria’s GDP Re-basing, Q1 2025 GDP Report, and Sectoral Analysis

August 3, 2025August 3, 2025 admin 0 Comments

By Dr. Muda Yusuf

The Centre for the Promotion of Private Enterprise(CPPE) welcomes the recent release by the National Bureau of Statistics (NBS) of the rebased Gross Domestic Product (GDP) figures, now anchored to a new base year of 2019. This re-basing exercise represents a significant milestone in Nigeria’s economic management, as it enhances the relevance, accuracy, and timeliness of national economic data, and aligns Nigeria’s statistical reporting with international best practices.

Significance of the GDP Rebasing

GDP re-basing is a critical statistical exercise that updates the base year used for calculating national output, ensuring that the structure of the economy is accurately reflected in line with current realities. By adopting 2019 as the new base year, Nigeria’s GDP figures now incorporate recent changes in consumption patterns, production technologies, and sectoral dynamics. This provides a more realistic and comprehensive picture of the economy, which is essential for effective policy formulation, planning, and investment decisions.

Key Value Propositions of the Re-basing

• Improved Investment and Planning Decisions:The availability of more current and robust data enables both public and private sector stakeholders to make better-informed decisions. Investors, policymakers, and development partners can now rely on more accurate statistics to assess opportunities and risks.

• Enhanced Macroeconomic Analysis: The re-basing allows for more credible calculation of key GDP-related ratios, such as debt-to-GDP, tax-to-GDP, revenue-to-GDP, credit-to-GDP, and fiscal deficit-to-GDP. These ratios are vital for assessing the health and sustainability of the economy, and for benchmarking Nigeria’s performance against global peers.

• International Comparability: The updated GDP figures facilitate more meaningful international comparisons, providing clearer guidance for foreign investors and supporting Nigeria’s integration into the global economy. This transparency is expected to boost investor confidence and attract foreign direct investment.

• Credible Sectoral Insights: The re-basing exercise has improved the accuracy of sectoral contributions, revealing shifts in the economic landscape and highlighting emerging sectors that were previously underrepresented.

The CPPE urges that future re-basing exercises be conducted more regularly and in a timely manner, in line with global standards, to maintain the relevance and credibility of Nigeria’s economic data.

Overview of the Q1 2025 GDP Report

According to the newly rebased figures, Nigeria’s nominal GDP was reported at ₦372.82 trillion as of 2024, representing a 41% increase over the 2019 nominal GDP. The economy recorded a growth rate of 3.38% in 2024. In Q1 2025, GDP growth moderated slightly to 3.13%, with total output for the quarter at ₦94 trillion.

This brings Nigeria’s cumulative GDP at the end of Q1 2025 to approximately ₦466 trillion, or an estimated $300 billion. As the Nigerian economy progressively recovers from the shocks of the current economic reforms, the CPPE projects that by year-end, Nigeria’s GDP could reach an estimated $450 billion, barring any major disruption in the economy.

It is important to note that economic activities in the first quarter were typically subdued compared to the other quarters, which may account for the observed moderation in Q1 GDP growth.

Sectoral Analysis and Policy Issues

The latest GDP numbers highlight the need to strengthen productivity in critical sectors such as agriculture, manufacturing, and trade. These sectors are essential for economic inclusion, job creation, self-reliance, economic security, and diversification. However, their current growth rates remain below expectations: agriculture grew by only 0.7% and manufacturing by 1.7% in Q1 2025. These sectors require targeted interventions to unlock their full potential and drive sustainable development.

A review of sectoral performance in Q1 2025 shows that:

• 37 sectors recorded growth (many howeverslowed)

• 9 sectors contracted,

• 3 sectors in recession.

Top-performing sectors included financial services[15.3%], oil refining [11.51%], transportation [14.08], ICT [7.4%], and metal ores [25%]. The following sectors contracted: Livestock [-16.7%], fishing [-0.21%], Textiles [-1.63], Coal Mining [-22.3%], Quarry & Minerals [-21.55%], Plastics and Rubber [-3.2%], Iron & Steel [-0.35%], Air Transport [-0.81%]. Sectors in recession include air transport, textiles, and coal mining. This follows their consistentcontraction over the past few quarters.

Sectoral Contributions in Q1 2025:

• Major contributors to GDP included trade, crop production, real estate, ICT, construction, petroleum and gas, food and beverage, financial institutions, and manufacturing.

• The oil sector contributed 3.97% to GDP, while the non-oil sector accounted for 96.03% indicating the sustained dominance of the non-oil sector in the Nigerian economy. But productivity remains a major challenge for the sector.

• The share of agriculture improved from 22.12% to 25.8%, and the service sector’s contribution increased to 53.09% from 50.22% pre-rebasing.

• Real estate sector ranking rose to third among GDP contributors, following crop production (17.58%) and trade (17.42%), with real estate at 10.78%, ICT at 6.18%, and crude oil at 5.85%.

Despite the non-oil sector’s dominant contribution to GDP, its share of government revenue remains disproportionately low. This indicates persistent productivity and revenue mobilization challenges in the non-oil economy, which must be addressed to ensure fiscal sustainability and inclusive growth.

Policy Recommendations

• Targeted Support for Underperforming Sectors:Special attention is needed for sectors in recession, those that contracted, and those experiencing slow growth. Addressing structural challenges, improving access to finance, tackling insecurity and fostering innovation will be critical to stimulating recovery and growth.

• Sustained Support for High-performing Sectors:High-performing sectors should continue to receive support to sustain and further improve their output, leveraging their potential as engines of growth, revenue generation and job creation.

• Bridging the Revenue Gap: There is a pressing need to address the disconnect between the non-oil sector’s significant GDP contribution and its relatively lower contribution to government revenue. Strengthening tax administration, broadening the tax base, optimizing non-taxrevenues and promoting formalization of economic activities in the informal sector are essential steps.

• Regular Data Updates: The CPPE advocates for more frequent and timely GDP re-basing exercises to ensure that economic data remains current and relevant for policy and investment decisions.

• Stakeholder Engagement: Continuous engagement with stakeholders—including government agencies, private sector participants, researchers, and development partners—is vital for effective policy formulation and implementation.

Conclusion

The CPPE commends the National Bureau of Statistics for this important milestone despite its resource limitations. The CPPE remains committed to supporting evidence-based policymaking and investment decisions and urges stakeholders to leverage these improved statistics for strategic planning, investment decisions, and policy development. Continuous engagement and timely updates will ensure that Nigeria’s economic data remains robust, reliable, and fit for purpose, guiding the nation toward sustainable growth and development.