The contribution of the finance and insurance sectors to the real gross domestic product grew to 6.22 per cent in 2024, higher than 4.97 per cent in 2023.
This was indicated in the fourth quarter GDP report released by the National Bureau of Statistics on Tuesday.
NBS said that the year 2024 ended with an overall annual GDP growth rate of 3.40 per cent, from the 2.74 per cent reported in 2023. Thus, there was a decline in the performance of agriculture and industry in 2024 relative to 2023, while the performance of the services sector improved in 2024.
Providing a breakdown of the contribution of the services sector to the real GDP, the report stated that “growth in this sector in real terms totalled 27.78 per cent, lower by 1.99 percentage points from the rate recorded in the 2023 fourth quarter and lower by 3.05 percentage points from the rate recorded in the preceding quarter. Quarter-on-quarter growth in real terms stood at 24.33 per cent. Overall, growth stood at 29.57 per cent, higher than the 26.53 per cent recorded in 2023. The contribution of finance and insurance to real GDP totalled 6.10 per cent higher than the contribution of 4.95 per cent recorded in the fourth quarter of 2023 by 1.14 percentage points and higher than 5.51 per cent recorded in Q3 2024 by 0.58 percentage points.”
In real terms, the two subsectors, financial institutions and insurance accounted for 94.53 per cent and 5.47 per cent, respectively.
In nominal terms, the sector grew at 82.09 per cent year-on-year, with the growth rate of financial institutions at 83.07 per cent and a 66.65 per cent growth rate recorded for insurance.
On the chart of the top ten contributors to the economy, the activities of financial institutions stood at number 5 (5.76 per cent) behind crop production (23.42 per cent), trades (15.11 per cent), telecommunication and information services (14.40 per cent) and real estate (5.88 per cent).
The non-oil sector, of which the finance and insurance sector is part, grew by 3.96 per cent in real terms during the reference quarter (Q4 2024). This rate was higher by 0.89 percentage points compared to the rate recorded in the same quarter of 2023, which was 3.07 per cent and higher than the 3.37 per cent recorded in the third quarter of 2024.
The GDP report indicated that in the fourth quarter of 2024, the non-oil sector was “driven mainly by Financial and Insurance (Financial Institutions); Information and Communication (Telecommunications); Agriculture (Crop production); Transportation and Storage (Road Transport); Trade; and Manufacturing, accounting for positive GDP growth.”
In real terms, the non-oil sector contributed 95.40 per cent to the nation’s GDP in the fourth quarter of 2024, higher than 95.30 per cent in Q4, 2024. On aggregate, the non-oil sector’s contribution to GDP in 2024 was 94.49 per cent, lower than the 94.60 per cent reported in 2023.
Commenting, investment house Comercio Partners, in its update on the GDP report, said that while it was a strong finish, challenges still linger.
“In Q4’24, the services sector, which powered ahead with 5.37 per cent growth, accounted for 57.38 per cent of total GDP. It’s clear that Nigeria’s economy is leaning more on services, while other sectors struggle to keep pace. Non-oil growth picked up speed at 3.96 per cent, showing that the economy isn’t entirely dependent on crude,” it stated.
On the sectors driving the economy, the analysts said, “Financial services and telecommunications have been standout performers, benefiting from digital transformation, fintech expansion, and rising mobile penetration. With Nigeria’s young, tech-savvy population, demand for digital banking, mobile payments, and internet services continues to grow. For the full year, Nigeria’s economy grew 3.40 per cent, a step up from 2.74 per cent in 2023. The services sector remains the economy’s MVP. Going forward, Nigeria needs to keep diversifying, invest in infrastructure, and stabilise its oil sector.”
Highlighting the effect of the rebasing of the GDP on Nigeria’s number, Comercio Partners stated, “The last GDP rebasing in 2014 significantly increased the size of the economy by capturing previously under-represented sectors such as telecommunications, entertainment, and fintech. Another rebasing will likely highlight the growing importance of services while offering better insights into structural shifts.”
On the outlook, the analysts said with the rebasing process in place, Nigeria’s GDP is projected to grow by approximately five per cent in 2025, driven by structural reforms, easing inflation, and increased local economic activity.
The update further read, “The Q4 2024 GDP growth of 3.84 per cent suggests Nigeria is on a strong trajectory, but sustaining this momentum requires policy consistency, investment in infrastructure, and a more diversified economic base. With the oil sector losing steam and agriculture slowing, Nigeria must strengthen non-oil sectors to avoid external shocks. The rebasing exercise will give policymakers better data, but execution remains key—GDP figures alone don’t create jobs or improve living standards.
“Nigeria’s economy continues to be driven by the services sector, but structural weaknesses persist. The financial sector and telecommunications are expanding rapidly, yet agriculture and manufacturing require targeted policy interventions. Policymakers should focus on improving agricultural productivity, strengthening trade supply chains, and boosting industrial output through infrastructure investment.”