Over N1 trillion was lost in the second quarter of 2023 in the food, textile, and 24 other economic sectors.
According to an analysis of the National Bureau of Statistics’ data on the Gross Domestic Product, 26 economic sectors experienced declines in Q2.
Since their combined contribution to real GDP decreased from N7.69tn in the first quarter of 2023 to N6.54tn, these sectors collectively lost N1.16tn in economic value.
Fishing, crude oil and natural gas, cement, food, beverage, and tobacco, textile, apparel, and footwear, wood and wood products, pulp, paper, and paper products, non-metallic products, basic metal, iron, and steel, motor vehicles and assembly, other manufacturing, building, lodging and food services, road transport, and air transport were the sectors that experienced declines in Q2, 2023.
Postal and courier services, publishing, motion picture, sound recording, and music production, arts, entertainment, and recreation, financial institutions, real estate, professional, scientific, and technical services, education, other services, metal ores, and plastic and rubber products were other industries that suffered in Q2 2023.
Real GDP increased marginally by o, according to the NBS’s most recent GDP results. 2.51% in Q2 2023 compared to 2.31% in Q1 2023, a 20 percentage point increase.
“Nigeria’s Gross Domestic Product (GDP) increased by 2 point 51% (year over year) in real terms in the second quarter of 2023,” it stated. The challenging economic conditions being experienced may be the cause of this growth rate being lower than the 3 point 54 percent recorded in the second quarter of 2022.
The economy shrank from 3 point 52 percent in Q4 2022 to 2 point 31 percent in Q1 2023 as a result of a cash shortage in the first quarter.
According to the NBS, “the first quarter of 2023 saw real GDP growth of 2.31% (year over year). This growth rate decreased from the 3.11% first quarter of 2022 and the 3.52% fourth quarter of 2022 figures. The negative effects of the cash shortage encountered during the quarter are blamed for the decline in growth”.
Even though Q2 2023 saw a 0 percentage point increase quarter over quarter, deteriorating economic conditions made sure that growth stayed below 3%. For the sixth consecutive month, inflation increased to 22.179% in June, putting more strain on purchasing power.
The International Monetary Fund expects a 3 point 2 percent growth rate for Nigeria’s GDP in 2023, so the country is still lagging behind projections.
The recent economic reforms that have been linked to the decline in economic activity are expected to have some short-term drawbacks. Businesses have suffered as a result of the elimination of fuel subsidies and the unification of exchange rates.
The current difficult economic environment and decreased productivity, according to the Manufacturers Association of Nigeria, have forced manufacturers to reduce staff.
Segun Kuti-George, the national vice chairman of the Nigerian Association of Small-Scale Industrialists, stated in a recent interview with The PUNCH that “if the GDP decreases, it can lead to job losses. It implies that we are producing less”