By Boluwatife Oshadiya | May 26, 2026
Key Points
- Real GDP grows 3.89% year-on-year in Q1 2026, up from 3.13% in Q1 2025
- Non-oil sector contributes 96.08% to GDP with 3.94% growth
- Services sector leads at 57.73% share with 4.31% expansion
- Oil production falls to 1.55 mbpd, oil sector grows modestly at 2.57%
- Agriculture rebounds strongly to 3.15% growth
Nigeria’s economy recorded a real Gross Domestic Product (GDP) growth of 3.89% year-on-year in the first quarter of 2026, according to data released by the National Bureau of Statistics (NBS). This represents an improvement from the 3.13% recorded in the corresponding quarter of 2025, though it reflects a moderation from the 4.07% growth in Q4 2025.
The NBS report, titled Nigerian Gross Domestic Product Report Q1 2026, provides quarterly estimates rebased on 2019 constant basic prices. Aggregate nominal GDP at basic prices stood at ₦110,786,347.01 million in Q1 2026, up 17.79% from ₦94,051,733.20 million in Q1 2025. Real GDP at 2019 constant basic prices was ₦51,261,306.14 million.
The services sector remained the dominant driver, contributing 57.73% to total GDP with a real growth of 4.31%. Key activities within services, particularly trade (17.89% contribution), telecommunications & information services (9.19%), and real estate (13.10%), underpinned this performance. Agriculture followed with a 23.16% share and 3.15% real growth, a notable rebound from near-stagnation of 0.07% in Q1 2025, driven primarily by crop production. The industry sector grew 3.50%, contributing 19.11% overall.
Top 10 Contributing Activities to Real GDP (Q1 2026)
- Trade: 17.89%
- Crop Production: 17.38%
- Real Estate: 13.10%
- Telecommunications & Information Services: 9.19%
- Construction: 4.85%
- Crude Petroleum and Natural Gas: 3.92%
- Food, Beverage and Tobacco: 3.48%
- Financial Institutions: 3.41%
- Livestock: 3.08%
- Professional, Scientific & Technical Services: 2.44%
The oil sector, while showing modest improvement, continued to lag. Average daily oil production stood at 1.55 million barrels per day (mbpd), down from 1.62 mbpd in Q1 2025 and 1.58 mbpd in Q4 2025. Real growth in the oil sector was 2.57%, contributing 3.92% to GDP. The non-oil sector expanded by 3.94%, accounting for 96.08% of overall GDP.
Other sectoral highlights include strong performances in water supply, sewerage, waste management & remediation (10.32% real growth) and construction (6.38% real growth). However, electricity, gas, steam & air conditioning contracted sharply by 15.30%.
The Issues
Nigeria’s Q1 2026 GDP performance highlights the ongoing structural shift toward a services-led economy, yet it also underscores persistent vulnerabilities. The modest overall growth occurs against a backdrop of high inflation (often exceeding 30% in recent periods), elevated borrowing costs, and supply chain pressures that continue to constrain manufacturing and household consumption.
Oil production remains below the government’s 2 mbpd target and OPEC quotas, reflecting chronic challenges including infrastructure deficits, security issues in the Niger Delta, and delays in upstream investments. This limits fiscal revenues and foreign exchange earnings despite global oil price dynamics. Meanwhile, the strong showing in agriculture and telecoms points to resilience in domestic-oriented sectors, but per capita gains remain limited due to rapid population growth.
A key tension is the uneven nature of growth. While non-oil sectors dominate, manufacturing grew only 3.29% and electricity contracted significantly, signalling infrastructure bottlenecks that hinder broader industrialisation. The report arrives as policymakers navigate reforms aimed at fiscal consolidation, exchange rate stability, and private sector participation, yet immediate impacts on citizens — particularly rising food costs — test public confidence in these measures.
What’s Being Said
“The services sector accounted for a larger share of Nigeria’s GDP in the first quarter of 2026,” the NBS noted in its analysis, highlighting the continued dominance of trade, telecoms, and real estate.
Analysts have offered mixed assessments. Business and economic observers point to non-oil momentum as evidence of reform traction. One commentary described it as “the start of real momentum” in tomatoes, cement, telecoms, and trade, while acknowledging that “inflation and hunger are still biting.”
Critics and public sentiment on platforms reflect scepticism, with comments noting that headline growth “masks citizens’ frustrations” amid persistent high living costs. Government officials have celebrated the figures as validation of ongoing macroeconomic reforms, including subsidy removals and efforts to boost non-oil revenues.
What’s Next
The NBS is expected to release subsequent quarterly reports, with Q2 2026 data anticipated around August 2026. The Monetary Policy Committee (MPC) of the Central Bank of Nigeria will continue to monitor growth alongside inflation trends in upcoming meetings.
Key forward-looking developments include implementation of tax reforms, potential improvements in oil output through new regulatory measures and investments, and the full-year 2026 budget execution. Analysts project full-year 2026 GDP growth around 4.0–4.3%, contingent on sustained non-oil performance and easing of macroeconomic headwinds.
The Bottom Line: Nigeria’s 3.89% Q1 growth demonstrates the resilience of non-oil drivers like services and agriculture in powering economic expansion, marking a step forward from the previous year. However, the persistent drag from the oil sector, infrastructure gaps in power and manufacturing, and the disconnect between aggregate figures and household realities underscore that sustainable, inclusive growth requires deeper structural fixes beyond headline improvements. Success in translating this momentum into broader prosperity will hinge on addressing these bottlenecks in the quarters ahead.
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