Construction and real-estate sectors have picked up massively from the economic meltdown that hit the country in 2016 to become key contributors to the country’s economic recovery, an analysis of data has shown.
The National Bureau of Statistics (NBS) recently released Gross Domestic Product (GDP) figures for the second quarter of 2018 indicating that for the first time since the country’s exit from recession in 2017, economic growth was driven by the non-oil sector.
According to the report, the non-oil sector expanded by 2.05 per cent and contributed 91.45 per cent to the nation’s Gross Domestic Product (GDP), compared to 90.96 per cent recorded in Q2 2017.
Among the sectors that led the expansion in real term were the construction and slightly real-estate sectors, including cement and wood product manufacturing.
According to the report, the construction sector grew by 7.66 per cent in Q2 2018 from -1.54 per cent in Q1 2018 and 4.14 per cent in Q4 2017.
Although, the real estate sector contracted by -3.88 per cent in Q2 2018 from -9.40 per cent in Q1 2018, it was higher than the 5.87 per cent reported in the preceding quarter.
The cement manufacturing sector grew by 3.84 per cent in Q2 2018 from 5.28 per cent in Q1 2018 and -1.92 per cent in Q4 2017, as well as wood and wood products by 2.23 per cent in Q2 2018 from 1.53 per cent in Q1 2018.
The analysis showed that the growth in the sectors could be attributed partly to the availability of foreign exchange and the improving economic climate which has encouraged investment in the country generally.
Also, findings showed that there has been a flurry of road construction and rehabilitation, rail, infrastructure and other capital projects this year which has seen the Federal Government pumping billions into them.
The Federal Government said around N1 trillion capital vote was released last year, the highest ever budgetary releases in Nigeria’s annual funding, for capital projects, with a promise to do more this year based on the current stability in oil price and the return of normalcy in the Niger Delta.
Findings also showed that over 20 road construction and rehabilitation projects across the country are to be funded in the 2018 budget.
The roads ministry is also said to have received proceeds from Sukuk bonds subscription worth N100 billion to fund repairs of 25 key economic road projects across the six geo-political zones of the country.
Government recently commenced the rehabilitation of the 30.4km Ikorodu-Sagamu road, the Lagos-Abeokuta Expressway as well as the reconstruction of the road from Apapa to the Toll Gate on Lagos-Ibadan Expressway.
Some other construction projects listed in the budget for this year include the outstanding sections of Apapa-Oshodi Expressway in Lagos; rehabilitation of Gombe-Biu road in Gombe and Borno states; construction of Ukana Akpa Utong/Iket Ntueu road in Akwa Ibom and construction of Umuerogha-Umuelema Nbubo road in Amasa Nsulu in Isiala Ngwa North LGA, Abia State among numerous others.
Rail projects have also moved on speedily with the launch of the Abuja Rail Mass Transit project. Work on other rail projects in Lagos, Ibadan, Kano and other states have kept activities in the construction sector eventful.
On real estate and housing delivery, a number of strategic collaboration between the private sector and government aimed at addressing the housing requirements of the country have been seen this year.
In a matter of months, the Federal Housing Authority (FHA) will perform the groundbreaking ceremony of one of its new flagship projects called the Diaspora City which will be constructed in seven states. A 700 hectare of land has been acquired at Abuja’s Maitama Extension for the Abuja section of the project.
Similarly, the Federal Mortgage Bank of Nigeria (FMBN) in conjunction with labour and trade unions will later this month perform the ground-breaking ceremony of the first phase of an affordable housing scheme for workers that will deliver 2,800 housing units in 14 sites across the country.
The private sector has been active in the market with the resumption of work at one of the most anticipated high-end developments in Abuja.
Promoters of the Abuja City Centre project recently said construction work had started at the project site two years after the economic downturn in the country affected the project. 95% of High Net-Worth Individuals Have A Hand In The Real Estate Pie
Located at the Central Area of Abuja, the project is designed to be a mix-use development with 28 high rise towers encompassing residences, hotels, high-end business school hub, shopping arcades, malls as well as hospitals and medical suites.
Credit: Daily Trust