Telecom and financial industry contribute 23.09% as Nigeria’s GDP surge by 3.84%

The Digital Industry sector has seen a 23.09 per cent contribution to Nigeria’s Gross Domestic Product (GDP) for Q4 2024, according to the latest data released by the National Bureau of Statistics (NBS). It revealed that the Q4 GDP surged by 3.84 per cent in real terms, compared to 3.46 per cent YoY. 

The digital industry sector which comprises the Information and Communications sector (I&C) and the Finance and Insurance sector (F&I) sector saw a contribution of 17 per cent and 6.09 per cent respectively during the fourth quarter. This reflects the significant force of how the sector drives the Nigerian economy.

The NBS in its statement noted that in the fourth quarter of 2024, the sector was mainly driven by financial and insurance institutions and information and communication (telecom). These industries played a key role in supporting economic activity during the period.

More explicitly, the I&C sector saw a contribution of N3.8 trillion in the same quarter compared to N3.6 trillion in Q4 2023. Of the N3.8 trillion, telecommunications contributed a whopping 84.2 per cent while others such as broadcasting, publishing, and music production struggled for the rest.

For the F&I sector comprising Financial Institutions and Insurance, it accumulated N1.37 trillion, a 28 per cent increase to N1.07 trillion in Q4 2023. A further breakdown shows that financial institutions surged by 28.7 per cent YoY while Insurance also increased by 17.18 per cent

For 2024, the digital industry sector contributed 23.9 per cent to the GDP, representing a 1.59 increase from the N17.1 trillion recorded in 2023. 

The I & C sector saw a GDP growth rate of 5.9 per cent for the fourth quarter while F&I had 27.78 per cent. The rates were not far-fetched when compared on a yearly basis with the F%I sector increasing from 26.53 per cent in 2023 to 29.57 per cent in 2024. However, the I&C sector GDP growth rate fell to 5.42 per cent from 7.91 per cent the previous year. 

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Q4 GDP – a broader scene 

Nigeria’s GDP increased by 3.84 per cent in Q4 2024 from 3.46 per cent in 2023. The growth was primarily driven by the services sector, which expanded by 5.37 per cent. The figure further underscores the resilience of the Nigerian economy despite global uncertainties. 

In 2024, Nigeria’s GDP growth stood at 3.40 per cent, up from 2.74 per cent in 2023, reflecting continued recovery from economic fluctuations and expansion in key sectors.

For the services sector such as electricity, digital industry, trade, and so on, it contributed 57.38 per cent to the nation’s overall GDP. This recounts a huge statement of its role as a critical driver of economic expansion.

Meanwhile, the agriculture sector experienced a slight slowdown, growing at 1.76 per cent, down from 2.10 per cent, in Q4 2023. Likewise, the industry sector recorded a 2.00 per cent growth rate, declining from 3.86 per cent in the previous year.

The report also revealed that the nominal GDP was N78.37 trillion in Q4 2024. Nominal GDP and real GDP both quantify the total value of all goods produced in a country in a year. However, while real GDP is adjusted for inflation, nominal GDP is not.

“This performance is higher when compared to the fourth quarter of 2023 which recorded aggregate GDP of N65,908,258.59 million, indicating a year-on-year nominal growth of 18.91%,” the bureau said.

For the oil sector, there was an average record in oil production of 1.54 million barrels per day (mbpd) in the fourth quarter of the year. The real growth of the oil sector was 1.48 per cent YoY in Q4 2024, indicating a decrease of 10.64 per cent points relative to the 12.11 per cent rate recorded in the corresponding quarter of 2023.

The non-oil sector grew by 3.96 per cent in real terms in Q4 2024. The rate was higher by 0.89 per cent compared to the 3.07 per cent recorded in Q4 2023 and higher than the 3.37 per cent recorded in Q3 2024.

Struggles to revive the Nigerian economy

Amidst the GDP report, there have been waves in Nigeria’s inflation and interest rates. The federal government continues to draw all boards in a bid to rescue the declining economic condition which has been hit by hyper-inflation and naira depreciation. 

Nigeria’s headline inflation rate dropped from 34.8 per cent in December 2024 to 24.48 per cent year-on-year in January 2025, following the rebasing of the Consumer Price Index (CPI).

The report highlights a decline in the general price level of goods and services compared to 34.30 per cent and 34.80 per cent in November and December 2024 respectively, which was calculated using the previous methodology.

The CBN has raised interest rates by a cumulative 16 percentage points since 2022 to curb decades-high inflation and stabilize the naira, which has depreciated by 70 per cent against the US dollar since the introduction of currency reforms in 2023.

Also, the Central Bank of Nigeria (CBN) in its MPC meeting last week decided to retain the monetary policy rate (interest rate) at 27.5 per cent. The CBN governor, Olayemi Cardoso, said that the committee of 12 members decided to retain the rate. 

The naira trading has seen a narrow band of 1,470 to 1,550 per dollar since early December.