Nigeria’s economy grew by 4.23% in the second quarter of 2025, driven by stronger performance in services, agriculture, and manufacturing, according to new data released by the National Bureau of Statistics (NBS) on Saturday.....KINDLY READ THE FULL STORY HERE▶

The growth marks one of the country’s strongest quarterly expansions since 2021, signaling a gradual recovery from years of slow growth, high inflation, and foreign exchange shortages.

Key Drivers of Growth

The NBS report showed that the non-oil sector continued to lead the economy, expanding by 5.7% in Q2. Key contributors were telecommunications, financial services, and trade. Agriculture also posted modest growth, supported by better harvests and improved rainfall across key farming regions.

Manufacturing grew by 3.1% after months of decline, a sign that recent policy measures to boost local production and reduce import dependence are starting to have some effect.

By contrast, the oil sector contracted by 2.4% as production remained below OPEC quotas due to pipeline vandalism, theft, and aging infrastructure. Oil has historically been Nigeria’s main revenue source, but its shrinking share highlights the country’s gradual shift toward non-oil growth.

Government Reaction

Finance Minister Wale Edun welcomed the report, calling it “a positive sign of resilience in the Nigerian economy.”

“This growth reflects the government’s ongoing reforms to stabilize the naira, curb inflation, and encourage private sector investment,” Edun said in a statement. “We are beginning to see the results of tough choices.”

The Central Bank of Nigeria (CBN) has tightened monetary policy since 2024 to fight inflation, which stood at 23.4% in July. Analysts say while high interest rates slowed consumer spending, they also helped stabilize the exchange rate and rebuild investor confidence.

Analysts’ Perspective

Economists say the 4.23% GDP growth is encouraging but warn that structural problems remain.

“Nigeria’s economy is moving in the right direction, but the growth is not yet broad-based,” said Ifeoma Okonkwo, a Lagos-based economist. “The oil sector continues to underperform, and inflation is still squeezing households. Until job creation improves, many Nigerians will not feel this growth.”

Unemployment remains high, especially among young people, with nearly 33% of Nigerians under 35 unemployed or underemployed, according to previous NBS data.

Regional and Global Context

Nigeria’s growth rate outpaced the Sub-Saharan African average, which the World Bank projects at 3.5% for 2025. It also places the country ahead of South Africa, whose economy grew by just 1.9% in the same period.

Global oil prices, which averaged $83 per barrel in Q2, provided some revenue support, but persistent production challenges limited Nigeria’s ability to benefit fully.

What It Means for Nigerians

Despite the strong headline numbers, many Nigerians say they have yet to see improvements in daily life. Food prices remain high, transportation costs continue to rise, and power supply is still unreliable in most parts of the country.

“The government says the economy is growing, but my salary is not enough anymore,” said Musa Ibrahim, a civil servant in Abuja. “Everything in the market is expensive.”

The NBS acknowledged that inflation remains a major concern, eroding household purchasing power. It said sustaining growth will depend on addressing insecurity in farming regions, improving energy supply, and maintaining macroeconomic stability.

Next Steps

The government has pledged to continue its reforms, including expanding infrastructure projects, improving power generation, and creating policies that attract foreign direct investment. Officials also hinted at new initiatives to support small and medium-sized businesses, which account for most of Nigeria’s employment.

International investors will be watching closely in the coming months to see if Nigeria can maintain this momentum while reducing inflation.

Outlook

Economists predict growth will remain above 4% for the rest of 2025 if reforms stay on track. However, risks include global oil price volatility, insecurity in rural areas, and possible political pressures as the government faces rising demands from citizens for quick relief.

“Nigeria has shown that it can grow beyond oil,” said Okonkwo. “The challenge now is to make that growth inclusive, so that it lifts millions out of poverty.”

The NBS will release its next GDP report in December, covering the third quarter of 2025.