The Centre for the Promotion of Private Enterprise says Nigeria’s 3.89% GDP growth in Q1 2026 is at risk unless the power sector crisis is fixed urgently.
The warning follows the National Bureau of Statistics’ report showing year-on-year growth for the quarter.
Reported by the National Bureau of Statistics,the growth is up from 3.13% in Q1 2025 but slightly below the 4.0% recorded in Q4 2025.
CPPE said the performance shows continued macro stabilization and resilience in non-oil sectors, though the quality of growth remains a concern.
Services drove the expansion, contributing 57.73% to GDP and growing 4.31%. ICT led with 10.98% growth, followed by entertainment at 11.25% and financial services at 8.54%.
Trade emerged as the single largest GDP contributor at 17.89%, buoyed by improved FX liquidity and easing inflation.
Manufacturing recovery was modest at 3.29%, up from 1.13% in Q4 2025, but its share of GDP stayed below 10%. CPPE blamed high energy costs, elevated interest rates, weak infrastructure, and policy uncertainty for holding back industrial output.
The standout performer was oil refining, which surged 37.46% — the fastest growth across all sectors. CPPE credited the Dangote Refinery for boosting domestic value addition and cutting import dependence. Construction, real estate, quarrying, and cement also posted strong gains.
Despite accounting for 96.08% of GDP, the non-oil sector contributed less than 15% of foreign exchange earnings, underscoring weak export competitiveness.
The biggest red flag was electricity and gas, which contracted 15.30% in the quarter — the steepest decline in recent years.
According to CPPE, unreliable power is eroding gains in manufacturing, SMEs, agro-processing, and digital services, as firms rely on costly diesel and petrol generators.
“Economic growth must ultimately translate into improved living conditions, stronger purchasing power and better welfare outcomes for citizens,” said CPPE CEO Dr Muda Yusuf.
He demanded accelerated power sector reforms, stronger transmission investment, improved market liquidity, and measures to boost industrialization and export competitiveness.
Aviation contracted 7.62% due to high jet fuel costs and multiple charges, while textiles remained in recession, reflecting deeper deindustrialization. Oil and gas growth also slowed to 2.57% from 6.79% in Q4 2025, with output still below budget targets.