In February, the National Bureau of Statistics (NBS) released Nigeria’s Gross Domestic Product (GDP) report for 2022. The report showed that the economy grew by 3.1% YOY in real terms, a slow growth compared to 3.4% in 2021.
A deeper look into the report by the NBS reveals that the minimal growth recorded by Nigeria’s economy was largely driven by sectors such as; the financial sector, transportation, waste management, trade, ICT and the construction sector, representing the fastest growing sectors in the economy in 2022.
Drawing from this report, here are the five fastest-growing sectors in the Nigerian economy in the year 2022 with some insight into what 2023 might look like.
Financial and Insurance Sector 16.36%
In 2022, the financial and insurance sector was the fastest-growing sector in the Nigerian economy with a growth percentage of 16.36%, an increase from 2021 10.1%. the sector improved from fourth position last year to stand top of the list in the review year. This sector comprises financial institutions and insurance subsectors.
The financial institution subsector recorded a positive growth rate of 17.24% in the year under review, while in the previous year, 10.53% was recorded. As for the insurance sector, it recorded 8.68% YOY. Outpacing the 6.24% recorded in the previous year.
Transportation and Storage 15.2%
Standing as the second fastest growing sector in Nigeria in 2022 with a 15.2% growth, the transportation and storage sector can be said to have ranked where it belongs considering the effect of the Russia-Ukraine war on the oil sector globally. Although, the growth of this sector slowed relative to the previous year, where it was significantly better at 16.3%.
This sector comprises food, water, air transport, road transport and other forms of transportation.
Water and Waste Management 13.62%
The waste management sector which consists of sewage, water supply and waste management grew by 13.6% in 2022, placing it as the third fastest-growing sector in Nigeria in the year.
When compared to the previous year 2021, the sector slowed down in growth from 18.3%.
Information and Communication 9.76%
The information and communication sector was the fourth fastest-growing sector in the Nigerian economy in 2022. The sector grew by 9.76% in 2022 an improvement from 2021 6.55%. This sector consists of telecommunications, publishing, motion pictures and broadcasting. This sector which includes some of the biggest companies in Nigeria grew by 10.72% YOY, an improvement from 2021 7.28%.
The information and communication sector in 2021 was in the 6th position of the fastest-growing economy.
Maintaining the fifth position from the previous year 2021, the trade sector grew by 5.13% YOY in 2022 representing a slow growth when compared to 8.62% from the previous year.
In truth, the trading activities of Nigeria have improved in the last two years, changing the narratives of 2016 and 2020. The signing of the African Continental Free Trade Agreement (AFCFTA) in July 2019 greatly improved trading activities between Nigeria and other African countries. Our ability to come out of the COVID-19 pandemic also meant there were improved trading opportunities for Nigeria.
While the above five sectors might have taken the lead in economic activities in Nigeria in 2022, there were other vibrant sectors that also made a mark in the country, like; construction 4.54%, art, entertainment and recreation 4.29%, accommodation and food services 4.22%, human health and social services 4.20%, and real estate 3.95%. Going by these numbers, 2023 can be said to hold better improvements. If the report by the NBS is anything to go by, then we should see an improved level of activities in all sectors especially the likes of, trade, information and communication, water and waste management, construction and a few others. It should be noted that these projected growths in 2023 largely depend on government policies, a smooth transition of government following the 2023 general elections and a host of other global factors.