How Nigeria’s economy maintained steady growth path in Q3’ 25,

Nigeria’s economy maintained steady growth path in Q3’ 25, reflecting slower growth from the previous quarter. According to the National Bureau of Statistics (NBS), real GDP expanded by 3.98% y/y, up from 3.86% in Q3’
24 but slightly below the 4.23% recorded in Q2’ 25. Nominal GDP remained strong, rising 18.12% y/y to N113.59 trillion, reflecting elevated prices and sustained activity across major sectors.

Quarter-on-quarter growth
strengthened markedly, with real GDP increasing by 11.39%, compared with 3.77% in Q2’ 25. This improvement was driven largely by the non-oil sector, which contributed 96.6% of total output and grew 3.91% y/y, up
from 3.64% in the previous quarter. Resilient growth across trade, ICT, agriculture, and financial services continues to underpin economic performance.

In contrast, the oil sector faced operational disruptions from
strike actions and maintenance activities, which temporarily reduced crude
production and softened its contribution. Overall, Q3’ 25 reaffirms Nigeria’s gradual transition toward a more diversified, non-oil-driven growth structure, even as macroeconomic conditions remain shaped by inflation, forex (FX) dynamics, and ongoing policy adjustments.

Oil Sector Weakens Amid Operational Disruptions in Q3 2025Source:

The oil sector grew by 5.84% y/y in Q3 2025, marking a significant deceleration from the 20.46% y/y recorded in the previous quarter. Beyond the moderation in growth, the sector’s share of total GDP fell to 3.44%, down from 4.05% in Q2 2025,underscoring the sector’s vulnerability to operational and labour-related shocks.

The weaker performance was largely driven by temporary production disruptions stemming from the PENGASSAN strike and scheduled maintenance activities across major oil facilities during the quarter. These operational challenges were reflected in the sector’s output profile. Average crude oil production slipped to 1.64mbpd in Q3, down from 1.68mbpd in Q2 2025 but still higher than the 1.56mbpd recorded in the corresponding period of 2024. This indicates that the sector’s
underlying recovery trajectory, supported by improved security and modest investment inflows, remains intact, even when
temporarily disrupted.

Within the non-oil sector, the services sector remained the dominant contributor, accounting for 53.02% of real GDP in Q3’
25 and expanding by 4.15%, up from 3.94% in Q2’ 25. This was followed by agriculture, which contributed 31.21% to real GDP and recorded 3.79% growth, an improvement from 2.82% in the previous quarter. The industrial sector accounted for 15.77% of total output, growing by 3.77%,though slower than the 7.46% recorded in Q2’ 25.

The top ten sectors collectively accounted for 90.75% of total GDP in Q3’ 25, compared with 89.37% in Q2, representing an increase of 138bps. In order of size, the largest contributors were agriculture (31.21%), trade (16.42%), real estate (13.36%), telecommunications (7.67%), manufacturing (7.62%), construction (3.80%), oil and gas (3.44%), public administration (2.56%), professional services (2.37%), and financial services (2.32%).

Sectoral growth trends were broadly positive in Q3’ 25. Agriculture expanded by 3.79% (vs 2.82% in Q2); trade grew by 1.98% (vs 1.29%); real estate rose by 3.50% (vs 3.79%); telecommunications increased by 6.14% (vs 7.39%); manufacturing grew by 1.25% (vs 1.60%); and the broader information and communication sector expanded by 5.78% (vs 6.61%). Strong gains were also seen in financial and insurance services, which surged 19.63% (vs 16.13%); construction grew 5.57% (vs 5.27%); oil and gas rose 5.84% (vs 20.84%, reflecting a sharp slowdown); public administration increased by 2.12% (vs
1.79%) and professional services grew 2.88% (vs 2.27%).

Harvest Gains Boost Agriculture Performance

The agriculture sector maintained its growth momentum in Q3 2025, expanding by 3.79% y/y, up from 2.82% y/y in Q2. Thisgrowth was primarily driven by a sharp recovery in crop production, which accelerated to 3.90% y/y from 1.62%, supportedby improved seasonal harvests and stronger domestic and export demand. Forestry activity rebounded to 4.69% y/y from1.66%, while livestock production contributed positively despite moderating slightly to 1.64% y/y. Fishing, however,experienced slower growth at 1.58% y/y, down from 2.57% in the previous quarter.The sector’s performance reflects several structural and cyclical factors. The easing of some supply chain bottlenecks improved the flow of inputs and outputs, while good harvests helped reduce the rate of food inflation, as observed in three consecutive months of falling month-on-month food inflation prices during Q3. With increased domestic demand, these factors reinforced agriculture’s role as a stabilizing and growth-supporting pillar of the non-oil economy.

Moderate Uptick in Trade Supported by Stronger Domestic Consumption

The trade sector grew by 1.98% y/y in Q3’ 25, up from 1.29% y/y in Q2’ 25. The uptick was supported by stronger consumer demand and relative forex stability, as reflected in the appreciation of the Naira, with the average exchange rate strengthening to ₦1,521/US$1 in Q3 from ₦1,580/US$1 in Q2. This currency stabilization improved the purchasing power of consumers and helped moderate input costs for businesses engaged in trade, contributing to increased retail and wholesale activity across domestic markets. The sector’s performance highlights the tradeindustry’s resilience and its continued role as a key driver of non-oil GDP growth, underpinning broader domestic economic activity during the quarter.The manufacturing sector grew by 1.25% y/y in Q3 ‘25, slightly below the 1.60% y/y recorded in Q2 ‘25, indicating a modest slowdown in industrial activity. The deceleration reflects continued challenges in production costs, energy supply, and input availability, which have constrained output in key sub-sectors such as cement, food processing, and consumer goods. Despite these headwinds, the sector maintained a positive growth trajectory, supported by steady domestic demand and ongoing efforts by manufacturers to optimize operations. While growth remains subdued compared with other non-oil sectors, manufacturing continues to be a critical pillar of economic diversification,providing employment and value addition to the broader economy.

Real Estate Growth Moderates to 3.50% in Q3 2025

The real estate sector grew by 3.50% y/y in Q3 2025, slightly down from 3.79% y/y in Q2, reflecting a modest slowdown in activity. The sector continued to benefit from demand for residential and commercial properties, driven by increased urbanization and population growth. While construction activity remained stable, higher costs of building materials and financing pressures limited the pace of new developments. Looking ahead, the recent slight monetary easing by the Central Bank of Nigeria (CBN) could provide a boost to the sector by lowering borrowing costs for developers and investors and stimulating construction financing, although the full impact is yet to materialize in the current quarter.

The construction sector grew by 5.57% y/y in Q3 ‘25, up from 5.27% y/y in Q2, reflecting a modest acceleration inactivity. Growth was supported by ongoing public and private infrastructure projects, including roads, bridges, and commercial developments, as well as continued investment in residential and industrial buildings. Despite this positive momentum, high cost of building materials and limited access to affordable financing constrained the pace of new projects. Looking forward, the sector is well-positioned to benefit from government-led infrastructure initiatives and improved liquidity conditions, which could accelerate project execution and sustain construction activity in the coming quarters.

Moderate Uptick in Trade Supported by Stronger Domestic Consumption

The telecommunications sector grew by 6.14% y/y in Q3 ‘25, moderating from 7.39% y/y in Q2. The slight slowdown was partly influenced by continued SIM deactivations linked to the National Identification Number (NIN) registration drive, which has strained subscriber growth. Despite this, the sector benefited from a continual demand for mobile voice and data services,driven by increasing digital adoption and ongoing network expansion. Persistent investment in infrastructure for expanded 4G and 5G deployment, and service innovations is expected to support growth and enhance connectivity in the medium term.

Financial Services Sector Sustains Strong Growth Amid Monetary Easing

The financial services sector grew by 19.46% y/y in Q3’ 25, up from 16.18% y/y in Q2, driven by higher interest income,increased lending, and investment activity. The MPC rate cut in September also supported growth by lowering borrowing costs,encouraging credit expansion, and stimulating market activity, although the full impact is expected to materialize gradually if monetary easing continues. The sector’s performance underscores its resilience and capacity to support broader economic activity.

Pattern of growth and outlook for 4th quarter 2025

We expect Nigeria’s economy to maintain moderate growth in Q4’ 25, underpinned by both oil and non-oil sectors, though the pace may vary across industries.Oil Sector: Crude oil output is anticipated to recover gradually following the disruptions observed in Q3’ 25 due to strikes and maintenance at major facilities. With planned production resumption and tighter security measures, oil output could stabilize, supporting fiscal revenue increases and foreign exchange inflows. However, global oil price volatility remains a key risk that could influence sectoral contribution to GDP.

Agriculture:

The peak harvest season may be fading, but the agriculture sector is still positioned for steady growth,supported by residual post-harvest supply, strong domestic demand, and firm export orders. Crop production, livestock, and forestry are expected to maintain solid performance, even as fishing activity softens. Improving logistics and easing food inflation will help sustain output, ensuring agriculture continues to anchor non-oil growth in Q4.

Services:

Services are projected to continue leading non-oil growth, with trade, telecommunications, financial services, and real estate benefiting from heightened consumer activity. The Yuletide season is likely to boost retail trade, hospitality, and entertainment segments, generating higher consumption and transactional volumes. Telecommunications will continue to support digital adoption, while financial services may gain from increased lending and investment activity, amplified by the start of expected monetary easing measures by CBN.

Manufacturing:

The manufacturing sector may see modest growth in Q4, constrained by input costs, energy supply challenges, and limited local raw material availability. However, heightened consumer demand during the holiday season and seasonal industrial activity could partially offset these constraints. Key sub-sectors such as food processing, cement,and consumer goods are likely to benefit from increased seasonal consumption.

Overall, Q4’ 25 is expected to see continued but moderate GDP expansion, with non-oil sectors, particularly services,agriculture, and manufacturing, leading the way, while the oil sector stabilizes. The Yuletide season will potentially present a temporary boost to consumption-driven sectors, which may positively influence quarterly growth and liquidity in the economy. We expect real GDP growth to settle at 4.02% y/y in Q4’ 25, bringing the full year 2025 growth at 3.82% y/y (vs3.34% y/y in 2024). SOURCE: Coronation Asset Management Limited