Organised Private Sector, Analysts Hail GDP Expansion, Caution Economy Not Out of Woods Yet

• ACCI, CPPE, NECA seek broader job-intensive growth

James Emejo in Abuja and Nume Ekeghe, Dike Onwuamaeze in Lagos

The Organised Private Sector (OPS) and economic analysts yesterday welcomed the country’s stronger Gross Domestic Product (GDP) growth in the second quarter of the year, saying the 4.43 per cent expansion offers evidence that economic reforms are beginning to gain traction.

They, however, cautioned that the economy remained some distance away from a broad-based recovery.

Abuja Chamber of Commerce and Industry (ACCI), while describing the performance as an encouraging signal, said the latest growth figure should not be mistaken for an indication that the economy had completely overcome its difficulties.

Director-General of ACCI, Agabaidu Jideani, said the acceleration in real GDP growth from 3.89 per cent in the first quarter to 4.43 per cent in Q2, above the 4.23 per cent recorded in the corresponding period of 2025, showed that economic activity was gradually gaining momentum.

Jideani told THISDAY, “The improvement from 3.89 per cent recorded in the preceding quarter and 4.23 per cent in the corresponding period of 2025 is an encouraging signal that economic activity is gradually gaining momentum.”

He stated that the performance was particularly significant from the perspective of the business community because of the contribution of agriculture, services, oil and the broader non-oil economy.

According to him, “It demonstrates a measure of resilience and suggests that ongoing economic reforms and increased economic activity are beginning to yield measurable outcomes.”

However, ACCI stressed that the real test of the recovery was not the headline GDP number but whether the expansion would translate into higher productivity, business expansion, job creation, increased investment, and improved living standards.

He said businesses were still contending with high operating costs, energy constraints, inadequate access to affordable finance, infrastructure deficits, logistics bottlenecks, and pressure on household purchasing power.

The ACCI director-general said, “While the GDP growth figure is encouraging, it would be premature to conclude that the Nigerian economy is completely out of difficulty.

“The real test of economic recovery lies in whether this growth translates into improved productivity, business expansion, job creation, increased investment and better living standards for Nigerians.”

The chamber also raised concern over the slowdown in parts of the industrial sector, urging sustained policy attention to manufacturing and other productive activities capable of generating jobs and strengthening domestic value chains.

Jideani said government must consolidate the positive momentum by improving infrastructure, addressing energy challenges, supporting local production, expanding access to finance, and implementing policies capable of attracting private investment.

He said, “In our view, the 4.43 per cent GDP growth is a welcome indication that the economy is moving in a positive direction, but recovery should not be measured by statistics alone.

“Nigerians and businesses must be able to feel the impact through lower costs of doing business, greater investment opportunities, job creation, and improved purchasing power.”

Similarly, Chief Executive Officer, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, described the performance as a significant acceleration, adding that the growth represents the strongest quarterly growth in five years.

Yusuf said the performance was “an important indication that the economy is gaining momentum after a difficult period of macroeconomic adjustment”.

He said the GDP report was “a strong and positive signal” that both oil and non-oil activities were contributing to the recovery while greater macroeconomic stability was beginning to support economic activity.

He said the broad spread of sectoral growth provided a credible basis for cautious optimism about the outlook.

The CPPE boss also warned against complacency, saying the next phase of the reform programme should focus on translating stronger output into employment, rising real incomes, and improved living standards.

Yusuf said, “The remaining sectoral weaknesses should be viewed as priorities for consolidating and broadening the recovery.

“A turnaround in electricity and textiles, renewed momentum in manufacturing, lower logistics and financing costs, and stronger consumer demand would substantially reinforce the gains already recorded.

“With consistent policies and focused implementation, the present recovery can become more industrial, employment-intensive and inclusive.”

He warned that policy inconsistency could reverse some of the gains already achieved.

Yusuf identified electricity, textiles, manufacturing, logistics, financing costs, and consumer demand as areas requiring urgent policy attention.

According to him, “The next phase should, therefore, consolidate these achievements while easing adjustment pressures on businesses and households through lower production costs, stronger social support and employment-focused investment.”

CPPE said sectors recording stronger output, including refining, extractives, finance, and telecommunications, should be better linked with agriculture, agro-processing, textiles, construction, trade, and small-scale manufacturing.

On agriculture, he described the sector’s improved performance as particularly encouraging given its importance to employment, food security, and rural incomes.

Yusuf called for greater investment in farm security, irrigation, improved seeds, fertiliser, mechanisation, extension services, storage, cold chains, insurance, credit guarantees and reliable industrial offtake.

He said, “The task is to strengthen their linkages with agriculture, agro-processing, textiles, construction, trade and small-scale manufacturing so that the expansion generates more jobs, supplier opportunities and household incomes.

“The momentum can be strengthened through farm security, irrigation, improved seeds, fertiliser, mechanisation, extension services, storage, cold chains, insurance, credit guarantees, and reliable industrial offtake.”

Yusuf further urged government to complement quarterly GDP releases with an inclusive-growth dashboard measuring employment, real wages, poverty-sensitive inflation, MSME performance, agricultural yields, manufacturing value added, electricity supplied to productive users, non-oil exports, and private investment.

“This would compel policy to focus not only on how fast the economy is growing, but also on who is benefiting from that growth,” he said.

For his part, Head of Consulting at Agusto Consulting, Jimi Ogbobine, said the figures were sending an important signal to investors that the reforms were beginning to produce measurable economic outcomes.

“I think what it starts to say to investors is that the reforms are now reflecting in the numbers,” Ogbobine told THISDAY, adding, “The reforms are now reflecting in the numbers, and it also begins to boost domestic and international confidence in the reforms.”

He, however, cautioned that 4.43 per cent growth was still inadequate to deliver the scale of economic transformation required to significantly reduce poverty.

Although the government had a seven per cent growth ambition, he said, “It would never get to that seven per cent in one quarter.”

He added, “Nigeria has to do at least seven per cent for eight to 10 years to lift millions out of poverty, the way the Chinese have done.”

Ogbobine said Agusto Consulting was projecting GDP growth of between four and six per cent over the next three years, with its 2026 forecast at 4.5 per cent and growth potentially reaching between 4.6 and 4.7 per cent this year.

He described such an outcome as “credit positive for Nigeria”.

Deputy Head of PAC Research, Afamuefuna Chukwurah, said the GDP performance provided some reassurance to investors, particularly when viewed alongside improving foreign exchange reserves and positive signals from international rating agencies.

Chukwurah stated, “The combination of stronger GDP growth, improving foreign-exchange reserves, and positive signals from international rating agencies provide a more reassuring macroeconomic backdrop for investors.”

Nevertheless, Chukwurah urged caution in interpreting the headline figure, stating that population growth of about 2.25 per cent means that the increase in output per person is significantly lower than the headline GDP growth suggests.

“Moreover, growth remains uneven across sectors,” he added.

Chukwurah said the non-oil sector, which accounted for 95.84 per cent of real GDP in Q2 2026, recorded positive single-digit growth across agriculture, manufacturing, and trade.

But he pointed to the 10.63 per cent year-on-year contraction in electricity, steam and air-conditioning supply as evidence that structural constraints continued to weigh heavily on productive businesses.

Chukwurah said government’s principal role should be to provide trunk infrastructure capable of reducing input costs for manufacturers and other businesses.

“Input costs decline would considerably improve the wage employment elasticity gap, which is largely below the continental average of 0.04 percentage points,” he said.

He pointed out that reducing production costs would have a multiplier effect on sustainable growth as the country pursued the seven per cent annual growth target.

On foreign investment, Chukwurah said ease of doing business remained critical, particularly the ability of foreign investors to repatriate funds.

He stated, “Investors consider the ease of doing business wherein foreign investors look at the ease of repatriating funds, which our increasing reserves at about $53 billion gives them something to hold on to.”

Chukwurah added that “improving macroeconomic activity to stability is still very much a work in progress”.

Ogbobine stressed that the standout feature of the Q2 figures was the more than seven per cent expansion in the oil and gas sector, which he described as the “real bright spot” in the latest data.

He said the country’s pursuit of economic diversification had at times been accompanied by policies that inadvertently constrained oil and gas expansion rather than allowing the non-oil economy to grow alongside it.

“Diversification remains a noble economic objective, but what inadvertently happened was that we constricted the growth potential of the oil and gas space, and it meant that other sectors growing would naturally outpace the oil and gas space,” he said.

He stated that the latest figures showed that Nigeria could achieve simultaneous expansion across different segments of the economy.

Ogbobine attributed the stronger oil and gas performance partly to policy changes across the downstream, midstream, and upstream segments.

He said subsidy removal had encouraged greater price discovery in the downstream market while creating room for the midstream, particularly refining, to expand.

In the upstream segment, he said relaxed fiscal measures were supporting investment in new concessions and final investment decisions.

Ogbobine said, “So, in terms of downstream, midstream, upstream, there are policy signals that seem to be stimulating growth across all three.”

He also cited improved fiscal terms in the gas sector and initiatives designed to stimulate domestic gas demand, including compressed natural gas for public transportation.

He said, “These are initiatives that touch on oil, all of the various segments of the oil and gas space. And I think that’s the brightest spot of these new numbers.”

Equally speaking on the GDP growth, Director-General, Nigeria Employers’ Consultative Association (NECA), Mr. Adewale-Smatt Oyerinde, described the Q2 performance as a mixed bag of optimism.

Oyerinde said, “For the employers, the message is a mixed bag of optimism. The headline figure is welcome, but the nation needs a definitive shift from consumption and services-led expansion towards manufacturing, real investment, agro-processing, and productive enterprise growth.

“The real test is whether the on-going reforms will continue to translate GDP growth into more decent jobs, higher productivity, improved productive capacity, stronger business competitiveness, and improved household incomes.”

Oyerinde said, “We note and commend the new Q2, 2026 GDP report by the federal government and wish to state that while this is encouraging, it is, however not a sign of full recovery but gradual recovery.

“The association wishes to state that as we have noted earlier, the economic direction is positive as growth has now strengthened for the second consecutive quarter, suggesting that the economy is gaining some momentum.

“The 4.43 per cent expansion is also the strongest quarterly growth reported since Q3 2024.

“We especially note the gradual recovery of key economic sectors and hope that this gradual recovery will be guarded and not eroded by regulatory challenges currently being faced by organised businesses. “

Oyerinde said a major concern remained the distortion between the GDP figures and the real conditions of businesses across sectors and whether GDP growth was translating into improved business conditions and living standards.

According to him, a 4.43 per cent expansion does not automatically mean that businesses are thriving or households are better off.

He said, “The industrial slowdown points to continuing constraints around energy costs, infrastructure, access to affordable credit, purchasing power and overall production costs.

“Conclusively, the Q2, 2026 GDP figure is a positive signal of a recovering economy, but the slowdown in industrial growth points to the fact that recovery is still fragile.

“The priority now should be to convert GDP growth into productive, visible, and inclusive impact.”