Nigeria’s GDP growth rises to 3.89% as agric, telecoms drive economic expansion

May 25, 2026 By Chisom Moghalu Economy

THE Nigerian economy recorded stronger growth in the first quarter (Q1) of 2026, as improved performance across agriculture, telecommunications, trade, manufacturing and financial services helped offset weaker crude oil production.

According to the latest report released by the National Bureau of Statistics (NBS), the country’s real Gross Domestic Product (GDP) grew by 3.89 percent year-on-year in Q1 2026, compared to 3.13 percent recorded in the corresponding period of 2025.

The latest figure indicates that economic activities strengthened at the start of the year despite persistent inflationary pressures, foreign exchange (FX) challenges and softer oil output.

The report showed that the services sector remained the biggest contributor to the Nigerian economy during the review period, accounting for 57.73 percent of total GDP, slightly higher than the 57.50 percent contribution recorded in Q1 of 2025.

The services sector expanded by 4.31 percent in real terms, driven largely by telecommunications, financial services, trade, transportation and real estate activities.

Agriculture emerged as one of the strongest-performing sectors during the quarter, recording a significant rebound from the previous year. The sector grew by 3.15 percent in Q1 2026, compared to the marginal 0.07 percent growth posted in Q1 2025.

The improvement reflects stronger crop production activities and increased contribution from agricultural value chains, which continued to support household consumption and economic activity across rural communities.

The industrial sector also recorded moderate improvement, expanding by 3.50 percent during the quarter, compared to 3.42 percent in the corresponding period of 2025.

In nominal terms, Nigeria’s aggregate GDP at basic prices rose to N110.79 trillion in Q1 of 2026 from N94.05 trillion recorded in Q1 2025. This represents a nominal year-on-year increase of 17.79 percent, reflecting both economic expansion and the impact of prevailing price levels across sectors.

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Despite the overall improvement in GDP performance, crude oil production declined during the quarter under review.

Nigeria recorded an average daily crude oil production of 1.55 million barrels per day in Q1 2026, lower than the 1.62 million barrels per day recorded in the corresponding quarter of 2025. Production was also below the 1.58 million barrels per day achieved in the fourth quarter (Q4) of 2025.

However, the oil sector still posted positive real growth of 2.57 percent year-on-year in Q1 2026, compared to 1.87 percent growth recorded in the same period of 2025.

The NBS noted that although the oil sector improved relative to the previous year, growth slowed significantly when compared with the 6.79 percent growth recorded in Q4 2025.

On a quarter-on-quarter basis, the oil sector recorded a growth rate of 9.31 per cent in Q1 of 2026.

The contribution of the oil sector to Nigeria’s total real GDP stood at 3.92 percent during the review period, slightly lower than the 3.97 percent contribution recorded in Q1 of 2025, but higher than the 2.87 percent contribution recorded in Q4 2025.

Non-oil sector remains major driver

The non-oil sector continued to dominate the Nigerian economy and remained the primary growth driver in Q1 2026.

According to the report, the non-oil economy expanded by 3.94 percent in real terms during the quarter, higher than the 3.19 percent growth achieved in the corresponding period of 2025.

Key sectors that supported non-oil growth included information and communication technology, particularly telecommunications, agriculture, trade, cement manufacturing, financial institutions, construction, transportation and storage services.

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The non-oil sector accounted for 96.08 percent of Nigeria’s real GDP in Q1 2026, marginally higher than the 96.03 percent contribution recorded in the same quarter of 2025.

The mining and quarrying sector also recorded notable improvements during the period.

The sector grew nominally by 13.92 percent year-on-year in Q1 2026, with crude petroleum and natural gas remaining the largest contributors, accounting for over 91 percent of the sector’s activities.

Crude oil performance

Crude oil activities recorded the strongest growth among the sub-sectors at 16.37 per cent, followed by quarrying and other minerals, which expanded by 14.55 per cent.

In real terms, the mining and quarrying sector grew by 1.89 percent year-on-year during the quarter, while its contribution to total real GDP stood at 4.14 percent.

Analysts say the latest GDP figures suggest that Nigeria’s economy is gradually becoming more diversified, with stronger contributions from agriculture, telecommunications and financial services helping to reduce dependence on crude oil revenues.

The data also highlights the increasing importance of non-oil activities in sustaining economic growth amid volatility in global oil markets and domestic production challenges.