Nigeria PESTLE Insights – A Macroeconomic Outlook Report

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Agriculture contributed 24.1% to the gross value added (GVA) in 2022, followed by mining, manufacturing, and utilities (21.9%) and wholesale, retail, and hotel activities (14.2%). In nominal terms, the three sectors are expected to grow by 16.8%, 16.8%, and 16.4%, respectively, in 2023.

Three cities generated around 23.0% of Nigeria’s GDP and comprised 11.1% of the country’s population, as of 2022, according to GlobalData’s cities database

PESTLE Insights of the Nigeria Macroeconomic Outlook Report

Political Landscape: The development of robust foreign relations between various stakeholders in the Nigerian economy is likely to strengthen market growth. For instance, in November 2022, the Nigeria Export Processing Zones Authority (NEPZA) and the Philippine Economic Zone Authority (PEZA) signed an MoU to promote economic cooperation and investment opportunities. Similarly, In October 2022, Nigeria and Saudi Arabia signed an MoU to promote mutually beneficial cooperation for both the economies through establishment of the Nigeria-Saudi Joint Commission. Furthermore, agreements with neighboring countries such as Egypt are expected to enhance cooperation in the sectors of construction, medical equipment, and engineering industries as well as agriculture, mining, technology, and real estate.

Economic Landscape: The country was ranked fourth in terms of ease of starting a business, according to the World Bank, Ease of Doing Business Report (2020). India, the Netherlands, and the US were the top three trading partners of Nigeria in 2021 and accounted for 25.9% of total trade (exports and imports. The government’s economic measures to curb the effects of the COVID-19 pandemic led to an increase in the government’s estimated borrowing requirement for the country. The government’s debt obligations have been steadily increasing and the wide public deficit has contributed to its continuous rise.

Social Landscape: Nigeria has performed well on various social parameters. According to the UNDP, Human Development Report (2021–22), Nigeria fared 163rd out of 191 countries. The country has witnessed an improvised level of human development. Nigeria is also expecting to launch the National Action Plan (NAP) 2022-2026 to curb human trafficking.

Technological Landscape: In terms of internet users as a percentage of the population, mobile and broadband penetration rate, the country ranked lower than its Middle Eastern and African peers in 2021, according to GlobalData. Nigeria has the lowest number of patents per million persons among its peer Middle Eastern and African nations. In August 2022, the Minister of Communications and Digital Economy announced the country is heading towards digital literacy and 95% of the population would attain digital literacy by 2030 through the National Digital Economy Policy and Strategy (2020– 30).

Legal Landscape: In September 2022, the Director-General of Nigeria Copyright Commission (NCC) signed an MoU with the Federal Airports Authority of Nigeria (FAAN). The agreement aims to curb the sale of goods that infringe copyright at the national airports in the country since numerous books and DVDs on display at the national airports were pirated, according to the NCC.

Environmental Landscape: On December 14, 2021, the World Bank approved a $700 million credit from the International Development Association (IDA) for the Nigeria Agro-Climatic Resilience in Semi-Arid Landscapes (ACReSAL) Project. The project aims to boost the implementation of sustainable landscape management practices in Nigeria to strengthen the country’s long-term enabling environment for integrated climate-resilient landscape management.

For additional highlights on each segment, download a sample report

Nigeria PESTLE Insights Overview

GDP 2021 $442.3 billion

Scope

In September 2023, the Minister of Works Nigeria revealed that the government requires approximately NGN217 billion ($512.6 million) for the construction of 269 roads across Nigeria. Following an inspection tour of various regions, including the Southwest, Southeast, Southsouth, and parts of the Northcentral and Northwest zones.

Key Highlights

The NGSEINDX Index exhibited a rising trend over the past year. As of November 27, 2023, the index stood at 71,228.8, compared to 47,554.3 on November 27, 2022.

Reasons to Buy

Macroeconomic Outlook Report identifies the potentials of the country as an investment destination by analyzing the political, economic, social, technological, legal and environmental (PESTLE) structure.

PESTLE Insights provides 360 degree view of the economy which can be used as a strategic tool to understand the market dynamics, business potentials and direction of operations

Along with providing the country’s snapshot, the report captures the risk factors pertaining to the macroeconomic risks, political environment, legal environment, demographic and social structure effectiveness, technology & infrastructure and natural and geographic aspects that might impact business.

This report also highlights key clusters/cities which contribute significantly to the country GDP and population along with major companies’ presence in these areas.

Arik
Oando
GT Bank

Table of Contents

List of Exhibits

Did You Know?

Country Highlights

Key Economic Updates

Country Snapshot

Political Landscape

Economic Landscape

Social Landscape

Technological Landscape

Legal Landscape

Environmental Landscape

Outlook

Table

Exhibit 1: Nigeria’s performance in terms of the country’s risk analysis in comparison to the Middle East and Africa and the world

Exhibit 2: Performance overview (score: 1–100)

Exhibit 3: Broad categories and weights behind the index

Exhibit 4: Nigeria stock exchange index – NGSEIND Index

Exhibit 5: Key sectors’ contribution to the economy

Exhibit 6: FDI inflows, FDI outflows, FDI inward stock and FDI outward stock (2018–22)

Exhibit 7: Greenfield FDI projects and net cross border M&A deals (2018–22)

Exhibit 8: Key infrastructure indicators

Exhibit 9: Real GDP and household consumption growth rate (2018–25f)

Exhibit 10: Real GDP growth rate comparison (2022)

Exhibit 11: Volume of exports and imports growth (2018–25f)

Exhibit 12: Current account balance (2018–25f)

Exhibit 13: Top three commodity exports, % of total exports (2018–22)

Exhibit 14: Mineral fuels, mineral oils and products of their distillation export, % of world total (2022)

Exhibit 15: Interest rates (December 2018 – December 2023)

Exhibit 16: Exchange rate and inflation (2018–25f)

Exhibit 17: General government deficit (2018–25f)

Exhibit 18: General government debt (2018–25f)

Exhibit 19: Unemployment rate (2018–25f)

Exhibit 20: Labor force participation rate (2018–25f)

Exhibit 21: Employment by sector (2018–25f)

Exhibit 22: Rural/urban share of total population (1995, 2005, 2015, 2025f)

Exhibit 23: Age-group share of total population (2005, 2015, 2025f)

Exhibit 24: Gender split (1995, 2005, 2015, 2025f)

Exhibit 25: Internet users as a percentage of total population, mobile penetration rate and broadband penetration rate (2022)

Exhibit 26: Number of patents granted per million population (2022)

Exhibit 27: High-technology exports, % of manufactured exports (2021)

Exhibit 28: Rule of law (rankings) 2023

Exhibit 29: Corruption perceptions index (rankings) (2022)

Exhibit 30: Renewable energy capacity (2017–21)

Exhibit 31: CO2 emissions (2017–20)

Figures

List of Figures

Exhibit 1: Nigeria’s performance in terms of the country’s risk analysis in comparison to the Middle East and Africa and the world

Exhibit 2: Performance overview (score: 1–100)

Exhibit 3: Broad categories and weights behind the index

Exhibit 4: Nigeria stock exchange index – NGSEIND Index (December 2021 – December 2022)

Exhibit 5: Nigeria exchange rate (December 2021 – December 2022)

Exhibit 6: Key sectors’ contribution to the economy (2017–24f)

Exhibit 7: Total capital importation (Q1 2021–Q2 2022) and capital importation by type of investment (Q1 2021–Q2 2022)

Exhibit 8: FDI by sector and FDI by country in Q2 2022

Exhibit 9: Key infrastructure indicators

Exhibit 10: Real GDP and household consumption growth rate (2017–24f)

Exhibit 11: Real GDP growth rate comparison (2021)

Exhibit 12: Exports, imports and trade balance (2017–2024f)

Exhibit 13: Current account balance (2017–24f)

Exhibit 14: Top three commodity exports, % of total exports (2018–21)

Exhibit 15: Mineral fuels, mineral oils and products of their distillation, % of world’s total (2021)

Exhibit 16: Interest rates (November 2017 – November 2022)

Exhibit 17: Exchange rate and inflation (2017–24f)

Exhibit 18: Public finance (2017–24f)

Exhibit 19: General government debt (2017–24f)

Exhibit 20: Unemployment (2017–24f)

Exhibit 21: Labor force participation rate (2017–24f)

Exhibit 22: Employment by sector (2017–24f)

Exhibit 23: Rural/urban share of total population (1995, 2005, 2015, 2025)

Exhibit 24: Age-group share of total population (1995, 2005, 2015, 2025)

Exhibit 25: Gender split (1995, 2005, 2015, 2025)

Exhibit 26: Internet users as a percentage of total population, mobile penetration rate and broadband penetration rate (2021)

Exhibit 27: Number of patents granted per million people (2021)

Exhibit 28: High-technology exports, % of manufactured exports (2020)

Exhibit 29: Doing business in Nigeria 2020

Exhibit 30: Corruption perception index (rankings) (2021)

Exhibit 31: Renewable energy, installed capacity (2016–20)

Exhibit 32: CO2 emissions (2016–20)

Frequently asked questions

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