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By Ayo Kehinde
According to the latest Gross Domestic Product (GDP) report released by the National Bureau of Statistics, Nigeria’s economy grew by 3.89% year-on-year in real terms in the first quarter of 2026, signaling a stronger economic performance compared to the 3.13% growth recorded in the corresponding period of 2025.
The report, released on Monday, shows that the nation’s economic growth over the period was driven largely by improved performance in the agriculture, telecommunications, financial services, manufacturing, trade, construction and transportation sectors, despite continued pressure from inflation, foreign exchange instability and declining crude oil production.
The NBS said the services sector remained the dominant contributor to the economy, accounting for 57.73% of aggregate GDP in the first quarter of 2026, higher than the 57.50% recorded in the corresponding quarter of 2025.
The latest data points to a broad, if uneven, recovery across major sectors of the economy, with agriculture emerging as one of the strongest growth drivers during the quarter.
According to the report, the agriculture sector recorded a real growth rate of 3.15% in the first quarter of 2026, representing a significant improvement over the marginal growth of 0.07% recorded in the first quarter of 2025.
Analysts say the strong recovery in agriculture could reflect improved agricultural activities, better agricultural production and a gradual recovery of food supply chains after prolonged disruptions caused by insecurity, floods and rising production costs in several farming communities across the country.
The industrial sector also recorded a moderate improvement during the period under review, growing by 3.50% compared to the growth of 3.42% recorded in the corresponding quarter of 2025.
Meanwhile, the services sector grew by 4.31% in the first quarter of 2026, slightly lower than the 4.33% recorded in the same quarter last year, but still maintaining its position as the largest contributor to Nigeria’s economic output.
In nominal terms, aggregate GDP at base prices stood at ₦110.79 trillion during the first quarter of 2026, compared to ₦94.05 trillion recorded in the first quarter of 2025.
The NBS said this represents nominal year-on-year growth of 17.79%, reflecting increased economic activities and price levels prevailing across all sectors of the economy.
Despite the overall economic expansion, the oil sector continued to encounter production difficulties in the quarter under review.
According to the Bureau, Nigeria recorded an average daily crude oil production of 1.55 million barrels per day (mbpd) in the first quarter of 2026, lower than the 1.62 mbpd recorded in the same period of 2025 and also lower than the 1.58 mbpd recorded in the fourth quarter of 2025.
The report said the oil sector grew 2.57% year-on-year in real terms during the quarter, an increase of 0.70 percentage points from the 1.87% growth recorded in the first quarter of 2025.
However, the industry’s growth performance has weakened significantly compared to the fourth quarter of 2025, when it recorded a stronger growth rate of 6.79%.
On a quarterly basis, the oil sector recorded a growth rate of 9.31% in the first quarter of 2026.
The oil sector contributed 3.92% to the total real GDP during the period under review, slightly lower than the 3.97% contribution recorded in the corresponding quarter of 2025, but higher than the 2.87% contribution recorded in the previous quarter.
Economic analysts have attributed the weak oil production data to the sector’s persistent challenges, including pipeline vandalism, crude theft, underinvestment and operational constraints impacting production capacity.
The report also showed that the non-oil sector remained the main driver of economic activities in the country.
According to the NBS, the non-oil sector grew by 3.94% in real terms in the first quarter of 2026, higher than the 3.19% recorded in the corresponding quarter of 2025, although slightly lower than the 3.99% recorded in the fourth quarter of 2025.
The Bureau noted that the non-oil economy was primarily driven by strong performances in the information and communications sector, particularly telecommunications; agriculture, in particular agricultural production; trade; cement production; financial institutions; real estate; construction; and transportation and warehousing, in particular road transport services.
In real terms, the non-oil sector contributed 96.08% to the national GDP in the first quarter of 2026, slightly higher than the 96.03% contribution recorded in the first quarter of 2025, although lower than the 97.13% contribution recorded in the fourth quarter of 2025.
Economic experts say the latest GDP data suggests Nigeria’s economy is gradually deepening its dependence on non-oil activities amid sustained volatility in global crude oil markets and domestic production challenges. However, they warned that stronger GDP growth data may not immediately translate into improved living conditions for many Nigerians who face rising food prices, high transportation costs, currency depreciation and declining purchasing power.
Nigeria’s inflationary environment has remained a major concern facing families and businesses, with food inflation continuing to put a strain on consumer spending and worsening poverty levels across the country.
The latest GDP report comes in the context of ongoing economic reforms by the federal government aimed at stabilizing the foreign exchange market, improving public finances, attracting investment and increasing productivity in critical sectors of the economy.
Market watchers say sustaining growth above 3.5% will require greater investment in infrastructure, greater security in agricultural regions, stable energy supplies, higher industrial productivity and reforms that expand job opportunities. They also highlighted the need to increase crude oil production and improve fiscal management to strengthen government revenues and support long-term macroeconomic stability.
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