2024 makes it the 10th year since Nigeria last rebased its economy.
The United Nations Statistical Commission recommends the exercise be carried out every 5 years. Nominally, Nigeria’s gross domestic product (GDP) stood at $510 billion when the country rebased its economy in 2014.
In 2024, the Nigerian economy is projected to grow to $504 billion, roughly $6 billion lower than it was 10 years ago. This can largely be attributed to the falling value of the local currency.
Analysts say the recommended five-year exercise is apposite because a dynamic economy like Nigeria’s is only expected to see the introduction of new sectors and the development of older ones over the period, hence the need to reflect that positive reality.
Rebasing the economy involves updating the base year used for calculating the country’s GDP to more accurately reflect the current economic structure. Nigeria last rebased its economy in 2014. However, economic conditions have changed, and the need for subsequent rebasing exercises arises.
On that note, the National Coordinator, Independent Shareholders Association of Nigeria, Moses Igbrude, noted that such sectors as maritime, forestry, insurance, agriculture, and solid minerals are either under-exploited or grossly under-captured in the country’s GDP3.
He told Nairametrics that there have been developments in these sectors since the last rebasing exercise in 2014 that are not being captured to reflect current realities.
He also said the technology and digital sectors have seen significant growth since the last rebasing in 2014.
- “Including emerging industries, such as fintech, e-commerce, and digital services, would provide a more accurate representation of the modern economy,” he said.
Dr. Muda Yusuf, the chief executive of the Center for the Promotion of Private Enterprise (CPPE) also harped on the maritime sector. He said much of the clearing and forwarding aspects of maritime are not being captured, although they are a huge part of the maritime industry.
He said there is a large part of the activities of maritime that is not being captured. He said the country has transformed in the entertainment and IT sectors also, which necessitates updating.
Mark Agbaso, an economic affairs analyst, cited the entertainment and creative industry as another that is under-estimated. He said Nigeria’s film industry and the broader entertainment and creative sector have experienced substantial expansion since 2014.
He stated that recognizing the economic contributions of these industries through accurate data would be essential for a comprehensive economic evaluation.
He also stated that renewable energy has expanded markedly since 2014 and still expanding. He said,
- “As the world shifts towards sustainable practices, the role of the renewable energy sector in Nigeria has likely increased. Incorporating data on renewable energy projects and their economic impact would better capture the country’s economic landscape.”
Also speaking, David Ogagan, a marketer in the agriculture sector, argued that a more detailed analysis of the agricultural sector, including its various value chains, would provide a nuanced understanding of the contributions of different sub-sectors.
This, he said, could include data on agribusiness, processing, and export activities. He said middlemen have emerged in the sector over the past several years, which has added value to investment and marketing in the sector.
Commenting on manufacturing, Ogagan stated that although there has been a general downward trend in the manufacturing sector over the past several years, changes in the manufacturing landscape, including the growth of new industries and the adoption of advanced technologies should be considered. “This would provide a more accurate reflection of the industrial sector’s contributions to the economy,” he noted.
Also commenting, Simeon Kemakolam, an architect, told Nairametrics that Urbanization and infrastructure development may have influenced the real estate and construction sectors. “Including data on real estate activities, housing projects, and construction can contribute to a more comprehensive economic assessment,” he stated.
Kemakolam added that the logistics and transportation sectors are critical components of a growing economy, stressing that accurate data on the transportation of goods and people, including the impact of innovations like ride-sharing services, should be considered.
On his part, a lecturer at Adeleke University, Professor Tayo Bello, cited that with efforts to enhance financial inclusion and the growth of new financial technologies, a comprehensive analysis of the financial sector, including microfinance and digital banking, would be crucial in rebasing the economy.
He added that the telecommunications sector has seen rapid evolution since the last rebasing. Including updated data on mobile communication, internet services, and related technologies is essential for an accurate economic assessment.
He added that the tourism and hospitality sectors contribute to the economy through travel, tourism, and related services.
- “An updated evaluation of these industries would capture their evolving role in the economy.
- “It’s important for any rebasing exercise to reflect the changing dynamics of the Nigerian economy and ensure that all key sectors are adequately represented. Regular rebasing helps policymakers make informed decisions and provides a more accurate picture of economic trends and contributions,” he stated.