Nigeria’s Economic Growth: A Mixed Picture of Progress and Challenges
Nigeria’s economy recorded a modest growth of 3.98 per cent in the third quarter of 2025, showing a slight improvement compared to the 3.86 per cent growth in the same period of 2024, according to the latest Gross Domestic Product (GDP) report released by the National Bureau of Statistics (NBS). This growth, while positive, has not yet translated into tangible benefits for small businesses and households, as highlighted by members of the Organised Private Sector.
The NBS report stated that real GDP grew by 3.98 per cent year-on-year in Q3 2025, outpacing the 3.86 per cent recorded in Q3 2024. The quarterly data reveals a mixed recovery across key sectors, with agriculture and industry showing stronger performance, while the services sector continues to dominate overall output. In real terms, aggregate GDP reached N57.03tn in Q3 2025, up from N54.85tn in the same quarter of 2024. Nominal GDP increased by 18.12 per cent year-on-year to N113.59tn, compared to N96.16tn in Q3 2024.
Services remained the largest contributor to GDP, accounting for 53.02 per cent, followed by agriculture at 31.21 per cent. The NBS noted that despite ongoing constraints, the economy sustained moderate expansion, driven by stronger activities in crop production, telecommunications, real estate, trade, and financial services. The report covers all 46 economic activities, classified into oil and non-oil sectors.
Oil and Non-Oil Sectors: Divergent Performance
The oil sector posted a real growth rate of 5.84 per cent in Q3 2025, up from 5.66 per cent in Q3 2024. Average crude oil production rose to 1.64 million barrels per day from 1.47 million barrels per day a year earlier, although it fell short of the 1.68 million barrels per day recorded in Q2 2025. The sector contracted by 5.53 per cent quarter-on-quarter, but its contribution to real GDP increased marginally to 3.44 per cent from 3.38 per cent in the same period of 2024.
In contrast, the non-oil sector expanded by 3.91 per cent, outperforming both Q3 2024 (3.79 per cent) and Q2 2025 (3.64 per cent). Agriculture grew by 3.79 per cent, improving significantly from the previous year’s 2.55 per cent. Crop production remained the backbone of agricultural output, accounting for nearly two-thirds of the sector’s nominal value. The sector contributed 31.21 per cent to real GDP in the period.
Manufacturing growth slowed to 1.25 per cent in real terms, down slightly from 1.74 per cent in Q2 2025. Its share of real GDP fell to 7.62 per cent, compared with 7.82 per cent in the corresponding period of 2024. Nominal growth was subdued at 3.45 per cent, far below the 13.83 per cent posted a year earlier.
Construction grew by 5.57 per cent in real terms, though this represented a modest decline from the 6.80 per cent posted in 2024. Its contribution to the economy edged up to 3.80 per cent.
Trade, which remains central to household consumption and retail activity, posted a real growth rate of 1.98 per cent, improving slightly from 1.69 per cent in Q3 2024. The sector accounted for 16.42 per cent of total output.
Information and communication services continued to outperform most major activities. Telecommunications and information services drove a real growth rate of 5.78 per cent for the broader ICT sector. Despite a quarterly contraction, ICT contributed 9.10 per cent to real GDP, up from 8.95 per cent in the same period of 2024.
Real estate—one of the strongest performers—saw its nominal output surge by 89.34 per cent year-on-year, though real growth was modest at 3.50 per cent. The sector contributed 13.36 per cent to real GDP, a slight decline from the 13.42 per cent recorded a year earlier but higher than the previous quarter’s 12.80 per cent.
Financial and insurance services grew sharply in real terms at 19.63 per cent, driven by stronger performance in financial institutions. However, their combined contribution to GDP fell to 2.65 per cent from 3.23 per cent in Q2 2025. Nominal growth stood at 40.55 per cent.
Human health and social services slowed to 2.89 per cent in real terms, down from 3.79 per cent in Q3 2024. Education grew by 2.51 per cent, slightly above the previous year. Public administration recorded real growth of 2.12 per cent, marginally lower than the preceding year.
IMF Upgrades Nigeria’s Growth Outlook
Earlier in October 2025, the International Monetary Fund (IMF) revised Nigeria’s economic growth outlook upward, projecting a 3.9 per cent GDP expansion in 2025. The growth is pegged on higher oil production, stronger investor confidence, and a more supportive fiscal stance as key drivers. The IMF also upgraded the 2026 growth projection by 0.9 percentage points to 4.2 per cent, while the 2024 growth figure was revised upward to 4.1 per cent.
Organised Private Sector Voices Concerns
Members of the Organised Private Sector welcomed the 3.98 per cent GDP growth in the third quarter of 2025, but cautioned that the marginal expansion is not yet reflected in the realities of small businesses and households. Leaders of the sector emphasized the need for tangible benefits for micro, small, and medium-sized enterprises (MSMEs), which continue to struggle under current economic conditions.
President of the Association of Small Business Owners of Nigeria, Dr Femi Egbesola, acknowledged the NBS data but stressed that the growth “is not reflective in the realities of the average Nigerian, and of enterprises, particularly small and medium enterprises.” He urged the government to focus on translating growth into real relief for businesses and households.
National Vice President of the National Association of Small-Scale Industrialists, Segun Kuti-George, described the growth as marginal but positive, noting that it signifies stability and a slight growth which is good for the overall economy. He attributed the expansion to non-oil activities and improved agricultural output.
The Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, noted that the 3.98 per cent growth remained a positive outcome when considering the economic conditions from which the country is recovering. He emphasized the need to tackle structural bottlenecks that restrain the real sectors, highlighting the low growth in manufacturing as a key concern.
