The Director-General of the Manufacturers Association of Nigeria, Mr. Segun Ajayi-Kadir, has advised the Nigerian government against using the rebasing of the Gross Domestic Product calculation and other economic reforms to downplay the country’s economic challenges.
Mr. Ajayi-Kadir gave this counsel at a press briefing in Lagos on Wednesday.
Nairametrics reported that the National Bureau of Statistics has decided to revise Nigeria’s Gross Domestic Product calculation by adopting 2019 as the base year, replacing the previous base year of 2010.
This means that constant prices previously based on 2010 will now be based on 2019.
Answering questions on the position of MAN on the rebasing and the association’s expectations on how the new calculation may impact the manufacturing sector’s performance, Mr. Kadri said it is a welcome development.
However, he warned the government against using the recalculation to downplay the seriousness of the economic challenges facing Nigeria.
He also commented on the government’s decision to tax illicit trade, which will reflect in the GDP, and cautioned the government against giving the impression that it is legitimizing financial crimes.
“The Nigerian rebasing, some people have started to question the basis for rebasing. We are even told the government will begin to assess the informal areas, the illegal, the illicit – Smuggling, kidnapping, and so on.
“Well, I know that it’s a form of terrible economic activity, and money is expended, but how you are going to correctly adopt it, whether you are not legitimizing illegality and whether you’re not recognizing them becomes another issue. But I think there’s wisdom behind rebasing.
“The only thing you need to do is do it correctly and don’t weaponise it, don’t use it as a political tool to water down the enormity of the challenge of the country.”
We will collaborate with NBS to ensure correct assessment of GDP
The DG added that the association will collaborate with the Nigeria Bureau of Statistics to get sufficient data for better assessment of the GDP.
“For us, we are disposed to the correct assessment of the GDP.
“We will, of course, respect NBS, whatever they come up with, and if we have issues, we are going to engage them, because we are already having some collaboration with them. There is need for us to have data to better assess things,” he noted.
What you should know
- The rebasing of the GDP has already been implemented by the NBS as reflected in its recent reports on GDP and inflation.
- Nairametrics reported that the Real Estate sector emerged the third-largest sub-sector in Nigeria’s economy, up from 5th position, as a result of the GDP rebasing exercise
- The rebasing exercise has rearranged the hierarchy of Nigeria’s leading industries. Although grain crop production and trade retain their positions as the largest and second-largest sectors, respectively, real estate displaced crude oil and natural gas to secure the third spot.
