Q4 2024 GDP growth expected to exceed 3.46%, but full-year growth may fall short, says experts

However, despite this anticipated increase, the full-year GDP growth rate is expected to fall below the Q3 rate.

The federal government projected a 3.75% GDP growth target in the 2024 budget. This growth rate targeted by the government for the full year 2024 is more than the growth rate analysts expect for the same period.

Notably, the ongoing GDP rebasing exercise will not impact the 2024 GDP value, as it is set to take effect starting in 2025.

In interviews with industry analysts, they provided the following outlooks on GDP performance.

Onyinyechi Onwubu, Investment Advisor FCSL Asset Management, expects Q4 2024 GDP to come in higher than the 3.46% reported for Q3′ 2024 by the National Bureau of Statistics (NBS). “We expect increased commercial activities due to the festive period in the latter part of the period to drive the Q4′ 2024 GDP to hover between 3.5% to 3.6% levels. The average GDP growth rate for 2024 is however expected to come in lower than this”.  

Moyosore Onanuga, Head of Investments at AIICO, anticipates that Nigeria’s GDP growth in Q4 2024 to be between 2.5% and 3.5%, driven primarily by increased demand during the festive season and a trade surplus. In Q3 2024, GDP grew by 3.46% year-on-year, surpassing the 2.54% growth rate in Q3 2023 and the 3.19% recorded in Q2 2024, according to the National Bureau of Statistics. The services sector remained the primary driver of growth, contributing 53.58% to GDP, with industries such as consulting, banking, legal practice, and FinTech playing a significant role.

“GDP is also expected to be rebased which will likely affect expectations going forward. However, we expect the fundamentals to still hold – economic activity does not increase due to the rebasing. It more accurately captures the economic activity that is already happening in the country”. 

Samuel Oyekanmi, Research Lead at Norrenberger reported that Nigeria’s GDP grew by an average of 3.21% between January and September 2024, with a full-year growth estimate of 3.3%, compared to 2.74% in the previous year 2023. “This highlights a modest but sustained economic expansion despite the challenges posed by contractionary policies and economic headwinds”.

Several factors are expected to drive Q4 2024 GDP growth above the Q3 level:

The federal government has a roadmap of a series of fiscal and monetary policy reforms to stabilize the economy and support growth in the economy:

1. Oil sector reforms

2. Revenue-enhancing measures

3. Monetary policy adjustments