Thursday, November 19, 2015 11:25AM / FBNQuest Research
From the latest national accounts we today highlight the five fastest growing sectors. We include what the NBS terms activity sectors, which are often subdivided into segments, and only those accounting for at least 1% of GDP at constant basic prices.
Education was again the leading sector, posting growth of 8.0% y/y (from 7.3% in Q2). It has government and private components: the first should benefit from the new administration’s spending plans and the second from its position as a core element of household budgets.
The five fastest growers all belong to the services sectors. In Q2 the share was four, the exception being construction which contracted by -0.1% in the last quarter.
Two of the five cater largely for middle-income and corporate Nigeria, ie finance and insurance, and professional, scientific and technical services. Anecdotal evidence and listed consumer goods companies suggest that the squeezing of household demand has hit low-income Nigerians disproportionately.
This theme could be extended to information and communications if we buy into the narrative that the telecoms operators are marketing data services rather than their vanilla voice products.
It does not apply to transport and storage, which is concentrated in the public sector.
For Q4 we see a pick-up in GDP growth from 2.8% y/y to around 4.0% on the basis of firmer household demand for the seasonal festivities. This demand crosses income levels.