Nigeria now Africa’s largest economy – FG
The Federal Government rebased Nigeria’s Gross Domestic Products (GDP), making the nation’s economy the largest in Africa ahead of South Africa.
The GDP which is the market value of all final goods and services produced within a country in a given period, has increased by 89.22 percent in Nigeria, making the country to also be ahead of Malaysia, Singapore and Denmark in the global ranking.
The figure was released by the Statistician General of the Federation, Dr. Yemi Kale, who said the results also indicate that Nigeria is the largest economy in Africa and the 26th largest in the world.
He said: “A key finding is that the economy, like that of many other middle-income countries like Thailand, Malaysia and Egypt, is becoming more service-driven as the services sector has expanded significantly.”
The results from the recalculated exercise indicated that nominal GDP is much higher than that previously estimated.
“In 2013, the rebased year the nominal stood at N80, 222,128.32 billion, representing 89.22 percent as against N71, 186,534.89 billion in 2011, representing 69.10 percent.”
Kale said the result of the GDP revealed better diversification of the Nigeria economy than earlier thought, adding that structure of the economy has changed significantly.
The real GDP post-rebasing estimated at 5.9 percent in 2011, 6.66 percent in 2012 and 7.41 in 2013.
The Minister of Finance Dr. Ngozi Okonjo-Iweala said during the release of the result that the new GDP stood at 453,966.82 (GDP current US $ million) which made Nigeria the largest in Africa from the old 258,555.58.
She said: “We did not set out to become the biggest economy in Africa. We set out to measure how much the economy has changed. And that is the outcome. Becoming the largest economy on the continent is a positive development but it is not destination. The knowledge derived will help us make better policies to grow the economy and create job for young Nigerians.”
Okonjo-Iweala said the result took so long to come out because rebasing is a rigorous and streneous exercise, adding that the effort of the National Bureau of Statistics has yielded great result.
In his reaction to the development, Dr. Muhammaed Muttaka Usman of the Economics Department, Ahmadu Bello University, Zaria, told Daily Trust that the figure is one thing and economic prosperity is another.
Usman, however, expressed his doubt about the calculation of the figure, saying there was need for independent bodies to calculate.
He asked: “Let’s take the level of unemployment, are we comfortable with what we have on the ground? Just last two weeks, in this country, 600,000 people applied for just 4,000 jobs, so it tells you the magnitude of the problem of unemployment we have. And another example, if you take this figure and compare with what the World Bank released on poverty index which placed Nigeria on low bottom and now you are saying Nigeria is the first in Africa, does that figure tally?
Usman said that a look at the countries Nigeria has now surpassed, revealed that things were working there whereas, here nothing works. He observed: “We have an economy that is run on generators, as at now, we have only 3,000 mw of electricity, we have a less than 18-hour economy, every economy that must progress at this rate, must be 24 hours economy, but here by 6pm everybody is off due to insecurity or other things.
“Fixed income investors will probably not pay much attention to the GDP dynamics,” Standard Bank’s Samir Gadio told Reuters in London, yesterday.
Despite roaring growth in recent years and a bigger GDP, Nigeria will continue to trail South Africa in terms of basic infrastructure - power and roads - necessary to lift the bulk of its population of 170 million out of absolute poverty.
“South Africa is going to stay the entry point for funds into Africa, I don’t think (it will move to) Nigeria,” Rigaardt Maartens, a portfolio manager at PSG Online Securities told Reuters.