NBS Report: ICT Contribution to Nigeria’s GDP Rises to 17.8% even as Real GDP Drops to N15.89 Trillion in Q2 2020
The contribution of the Information and Communications (ICT) sector to Nigeria’s total GDP (Gross Domestic Product) increased by 3.76% in the second quarter of 2020, according to data by National Bureau of Statistics (NBS).
However, the total GDP of the country dropped 7.97 % after the quarter. Reports show that the GDP fell from N16.74 trillion in Q1 2020 to about N15.89 Trillion in Q2 2020.
only 13 out of 46 Sectors recorded positive real growth in Q2 2020. Last Quarter, 30 sectors recorded positive growth.
Similarly, the performance for the half-year of the year shows that growth declined 2.8 year-on-year (YoY) compared to the 2.11% growth recorded in the first half of 2019.
According to the NBS, the decline was caused mainly by the significantly lower levels of both domestic and international economic activity during the quarter.
The low levels stemmed from the nationwide shutdown efforts aimed at containing the COVID-19 pandemic.
The drop in oil production also contributed to the decline of the GDP as the real growth of the oil sector declined by 6.63% year-on-year in Q2 2020. The sector also declined 11.69% points when compared to the growth of 5.06 recorded in Q1 2020.
ICT Contribution grows by 17%
Since the beginning of the year, the ICT sector has been one of the major contributors to Nigeria’s GDP. In Q2, the sector’s contribution grew higher by about 17.83% increasing the amount contributed to about N1.78 trillion. The sector contributed N1.28 trillion in Q1 of 2020.
The Information and Communications sector comprises of Telecommunications and Information Services, Publishing, Motion Picture, Sound Recording and Music Production, and Broadcasting.
The sector recorded a positive growth rate of 15.09% from the 9.99% recorded in Q1 2020 and 9.01% in Q2 2019.
Also, for the second consecutive quarter this year, the sector contributed a higher margin to the GDP when compared to crude oil, the country’s prize commodity. The ICT sector contributed 17.83% while oil sector contributed 8.93%.
As a subsector, the Telecommunications and Information Services had a growth rate of about 18.10% almost doubling its 9.71% growth in the previous quarter.
Summary
Although ICT contribution for the quarter was significant, the drop in growth across most sectors shows that more needs to be done to help the country’s economy recover from the effects of the pandemic.
Going forward, the continuous drop in the contribution of the oil sector to the country’s GDP calls for more efforts to be put into an alternative source of revenue like the thriving ICT sector.
