GDP rebasing boosts Nigeria’s Vision 2020 target

From Ngozi Onyeakusi, Lagos

CEO, RTC Advisory Services Limited, Opeyemi Agbaje, has said that the Gross Domestic Product (GDP) rebasing exercise suggests that by mere statistical adjustments and better measurement of Nigeria’s economic activity, the country is on its way to achieving the Vision 2020 target.

According to him, the Vision is to place Nigerian among the best 20 economies in the world by year 2020.

Speaking at the Finance Correspondents Association of Nigeria (FICAN) Bi-Monthly Discourse held in Lagos said rebasing makes Nigeria the 26th largest economy in the world and biggest African economy by 2013.

He noted that the feat also enhances the country’s Vision 2020 target considering its GDP growth rate post-rebasing averaging 6.4 per cent.

Speaking on the theme: ‘Nigeria’s Economy in First Quarter 2014: Issues and Outlook’, he said GDP rebasing does not imply an increase in national income and productivity. He also said GDP is not a measurement of income, but of economic output and production within an economy.

“GDP rebasing doesn’t alter our poor performance in terms of poverty, unemployment and inequality-GDP rebasing doesn’t change the material conditions of individuals, homes and firms within the economy,” he said.

Agbaje said the excercise gives Nigeria a more accurate picture of the current state of our economy and presents a more credible and contemporary report of the state of sectors and overall activity within the economy.

Continuing, he said: “Nigeria’s GDP rebasing clarifies some previously unresolved incongruities in our economy, like why the large global telecommunications companies and sector analysts under-estimated the potential depth and size of the sector pre-digital mobile license auction in 2001”.

The exercise, he said, also clarifies issues relating to why per capita GDP appeared somewhat larger than previously thought. He added that is a common sense measure consistent with global best practice that simply updates a country’s assumptions and templates for measuring our level of economic output.

Besides, Agabje said the fact that there is more accurate information about sectors and output is good for potential investors, both foreign and domestic even as financial markets would probably take more interest in the Nigerian economy given its new GDP figures.