Nigeria GDP grows 6.5 pct in Q3, oil output climbs

LAGOS (Reuters) - Nigeria, Africa's second-biggest economy, grew 6.5 percent in the third quarter from a year earlier, helped by solid growth in the non-oil economy, data showed on Monday.

GDP growth accelerated slightly from 6.3 percent in the second quarter of this year, figures from the National Bureau of Statistics (NBS) showed on Monday. Oil output in Africa's biggest producer climbed nearly 6 percent from the corresponding period a year ago.

Nigeria's economy has been slowing this year due to a slowdown in developed economies that buy Nigerian oil and to the impact of an Islamist insurgency in the north of the country. The government forecasts 6.5 percent economic growth this year, down from 7.4 percent last year.

The NBS said the non-oil sector was "still the major driver of the economy", recording 7.6 percent growth in the third quarter and supported by growth in the building & construction, cement, hotel, restaurant and electricity sectors.

The contribution of oil to the overall economy fell to 13.4 percent, from 14.3 percent in the same quarter last year. Oil output rose to 2.52 million barrels per day (bpd), from 2.38 million bpd in the second quarter of this year.

Nigeria is among the world's top 10 oil exporters and holds the world's ninth-biggest gas reserves. Oil accounts for around 80 percent of government revenues but agriculture is the largest contributor to GDP with a weighting of around 40 percent.

Inflation remains high and rose marginally in October, to 11.7 percent, from 11.3 percent in September. Food inflation accounted for a large portion of the increase, rising to 11.1 percent, compared with 10.2 percent in September.

Most analysts expect interest rates to be kept on hold at 12 percent when the central bank (CBN) announces the monetary policy committee's decision on Tuesday.

Rates have been on hold since November last year as the CBN prioritises building foreign exchange reserves, taming inflation and supporting the naira currency, over lowering borrowing costs.

Standard and Poor's upgraded Nigeria's credit rating this month to BB-, three notches below investment grade, citing improved financial stability and optimism over reforms to the banking and electricity sectors.

Africa's most populous nation is still hobbled though by widespread government corruption and mismanagement.

Source: http://news.yahoo.com/nigeria-gdp-grew-6-48-pct-third-quarter-082746628--finance.html

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