Poverty of voodoo statistics: Politics and the contribution of Nollywood
Yesterday, our dear country Nigeria leap-frogged South Africa and became Africa’s largest economy. We did this by changing the base line for calculating our GDP from 1990 to 2000. This rebasing boosted our economic growth by about 75%. The economy grew from $292 billion dollars to $510 billion in one day. By this statistical feat, we have progressed from the 37th to the 26rd largest economy in the world. The economy of South Africa is a mere $384 billion so let’s all feel good; we are the greatest in Africa. My very warm congratulations to our Minister of Finance, who made the announcement yesterday.
The South Africans have upset our feelings by being members of G20 thereby stealing our position as the greatest African nation and now we can begin our revenge. The most painful was when the BRIC quickly developing countries, namely Brazil, Russia, India and China were to be expanded by one; we all expected it would become BRINC with the addition of Nigeria. Instead, it became BRICS with the addition of South Africa. Now it’s settled, we have the largest African economy since 2 p.m. yesterday afternoon.
Let me say up front that I do not think that we are falsifying facts, even if we are embellishing them a little bit. Most governments overhaul GDP calculations every five years to reflect changes in output and consumption and we have not done ours for over twenty years. When Ghana rebased its GDP in 2010, output jumped 60 percent and from one day to the next, Ghana became a middle-income country. For Nigeria, our government is hoping that being the continent’s number one economy could prove an irresistible magnet for foreign investors. Under the leadership of Ngozi OkonjoIweala, what we did was to update the contributions of new sectors of the economy. Nollywood come in very useful as the estimate of its annual contribution to the Nigerian economy jumped from $500 million to $7 billion, an incredible jump maybe, but why not, it’s all about good fiction. Thanks to the rapid growth of the telecommunications sector, Nigeria has become Africa’s biggest mobile market with an estimated 167 million subscriptions, according to the Nigerian Communications Commission.
There is no doubt that Nigeria has been growing as a destination for foreign investors owing to the size of its consumer market and the increasing recovery of the capital market. Shoprite and Wal-Mart are moving in massively into the country precisely because of the growth of the consumer market. The consumer industries such as Nestle, Heineken, Cadbury and Unilever are doing very well. Our own Dangote Cement has already made the transition from a Nigerian to an African giant. There is a credible narrative about the growth of the Nigerian economy. The problem with statistics however is that they only tell part of the story. In reality, the 75% growth of our economy that happened yesterday would not mean any change in the lives of ordinary Nigerians. We will continue to live without electricity supply and potable water. The potholes on our roads will not disappear. And the insecurity in the land will continue. Our economy is today apparently larger than that of Austria, Malaysia and Thailand.
The real issue for me however is what does it really mean to say our economy is the largest in Africa. Nigeria remains a very poor country with almost 70% of the population living below the poverty line. No Nigerian city has potable water for up to 30% of inhabitants. South Africa has a population of 52 million people compared to Nigeria’s 170 million. South Africa’s GDP per capita is however $7,508 compared to $1,555 for Nigeria according to 2012 statistics. South Africa’s electricity production is 40,000 megawatts and will double by 2025 to continue feeding its large industrial base while in Nigeria; we are currently struggling to produce 3,000 megawatts.
Just last week, the World Bank President classified Nigeria among the world’s five extreme poor countries. In quick response, the Minister of Finance, Ngozi Okonjo-Iweala, challenged the classification, which is based on the large number of poor people living in the country. She argued that using the number of poor people in a country, irrespective of the country’s level of development as the parameter to rate Nigeria among nations with high poverty levels was wrong. She added that the phenomenon of large number of poor people was peculiar to middle-income countries, which Nigeria belonged. Citing the example of India, a middleincome country, which is one of the largest economies in the world like Nigeria, Dr OkonjoIweala said the largest number of poor people in the world resides in India, China and other places. Nigeria, she concluded, was no exception, as the reality today was that most middle-income countries, including Brazil, have large number of poor people.
For 100 million Nigerians living below the poverty line, what is the comfort of knowing that there are also lots of poor people in other developing countries such as Brazil and India? For Nigerians, the real problem is that they do not see the benefits of the 15 years of constant economic growth that we have had. Yes, it’s true that they have seen more Nigerians join the Forbes list of the world’s richest people but the Nigerian people know that their lives and livelihoods are worsening every day.
This is where I have a problem with the positive spin Dr OkonjoIweala is always giving the economy. Again last week, she announced with glee that “after two months of methodological work, the statisticians have come up with the data that 1.8 million people in the country enter the job market yearly. I am happy to tell you that last year we were able to create 1.6 million jobs. So we are getting close to the 1.8 million that enter the job market.” She must be the only person in Nigeria to believe that we created 1.6 million jobs last year. What we do know is that the National Bureau of Statistics is under enormous pressure to produce positive economic spin. What we see with our eyes is the pathetic photographs of hundreds of thousands of young people desperately struggling for the Nigerian Immigration Service jobs and being killed in the process. She should take us seriously and show us where the jobs were created and who got them. In most countries, job statistics is not under the control of government and is done by independent bodies. Why do we have a situation in which government officials can tell us anything they want to on job creation? The new statistics may be true but voodoo too as all Africans know is a true science. Voodoo statistics can make us feel good but it’s more important to address the problems of 100 million Nigerians living below the poverty line.