|
Rebasing The GDP By Onike Rahaman
The ongoing media debates on Nigeria’s rebased nominal Gross Domestic Product, GDP, offer insight into intrigues of using statistical tools for economic and political considerations. With the publicity given to the 2013 estimate of Nigeria’s nominal GDP, it is assumed that the rebasing exercise has political undertones.
What we are made to believe is that sectors such as telecommunication, film industry, music industry that were excluded in the past have been captured in the rebasing exercise. The observable changes in the structure of the nation’s economy have caused a sort of decline in the share of Agriculture and a rise in the share of services in the nominal GDP. The service industry has truly witnessed a boom in past decade.
Nigeria’s economy has become more diversified with the rebasing of the previously excluded sectors. Even with the suspicion across the social strata, rebasing ought not to be neglected for 24 year, the exercise that supposed to be done every five years. One important question that continues to agitate mind is the reason why government do not capture informal sectors in the previous rebasing exercise.
While Nigeria’s new GDP figure may not mean much to average Nigerians beyond being a mere statistical thrash or an indication of developments in the economy; yet, it is a good analytical tool in that there can be no proper national planning without a reflection on the nominal GDP.
Despite the realities of the nation’s malformed economy, the new bragging has catapulted Nigeria to the new status of the biggest economy in Africa thereby pushing the South Africa the previous holder of the title to the second position.
Nigeria’s claim to
African leadership is anchored on the 2013 estimate of Nigeria’s
Nominal Gross Domestic Product, recalculated with year 2010 as the
base year now stands at $509.9 billion, up from $285.56 billion in
2010. From the analysis of National Bureau of statistics, the
nominal GDP in 2012 put the value at
Obviously, the rebased nominal GDP represented an increase of 59.9 per cent using the old base year and 69.10 per cent in 2011, as well as an increase of 75.58 per cent in 2012 and a projected 89.22 growth per cent in 2013.
Beyond the dubious growth statistics is the inherent failures in Nigeria’s leadership. It is a simile contradiction, for supposedly biggest economy in Africa to be classified by world bank few days before the rebased GDP ranking as one of the extreme poor nations in the world. With this, the claim sounds to have mind-blowing effect on the true reality of the nation’s economy. Of course, whoever that is solicitous about Nigeria is bound to reflect on the far-reaching implications of Nigeria’s sudden emergence as the biggest economy in Africa.
Given the circumstance of the Nigeria’s new hegemonic status within the regional economic context, there are reasonable grounds to suspect manipulations in the calculation of the rebased nominal GDP.
In terms of real development, rebasing will neither change the underpinnings of the nation’s economy overnight, nor will it make possible for Nigeria to overtake South Africa, the hitherto Africa’s most developed economy.
Moreso, the security challenges the country is currently facing is not only a serious hindrance to Nigeria’s economy prosperity but it also undermines the government desire to provide enabling environment for both foreign and local investments. Again, the new nominal GDP figure has equally leapfrogged Nigeria to the 26th position in terms of size of economy ahead of Countries like Austria, Venezuela, Columbia, Singapore, Denmark, Malaysia and Thailand.
Of equal importance is the fact that the new rebased nominal GDP figures portray the Country as having a strong consumer base. Apart from the positive impact the new GDP ranking has on the nation’s image and perception, it is a boost to Nigeria as an investment destination. Also, it offers a good basis for sound economic policy and decisions.
When the rebased nominal GDP is viewed against the nation’s population size, the Nigeria’s GDP per capital still remains low. On this per capital basis, Nigeria is now ranked 121st in the world, rising from the previous 135th position.
With Nigeria’s new vintage position as the biggest economy in Africa, one would expect a grim statistics of the population of Nigeria’s living in abject poverty to have been reduced. Given the recent report from the National Bureau of Statistics, about 112 million Nigerians live below poverty line. The figure represents about 67 per cent of the entire population. It is somehow difficult to reconcile this figure with the claim that Nigeria is now the biggest economy in Africa.
It seems the whole idea is based on propaganda. And no matter its effectiveness Nigeria cannot usurp the diadem from South Africa only on the strength of Statistical manipulation even when our economy lacks all the major index that make South Africa, the Africa’s most developed economy. |