In the ever-evolving dynamics of global economies, understanding the mechanisms and processes that provide accurate measurements of economic activity is essential. One such critical statistical exercise is the rebasing of Gross Domestic Product (GDP). For Nigeria, a country with a diverse and complex economic structure, GDP rebasing is more than a technical adjustment—it is a vital tool to capture the current realities of its economy, enabling policymakers, businesses, and citizens to make informed decisions.
At the heart of this undertaking is the National Bureau of Statistics (NBS), the authoritative source of official statistics in Nigeria. The NBS, tasked with coordinating the national statistical system, plays a pivotal role in ensuring that the process of GDP rebasing adheres to international standards while reflecting the unique characteristics of the Nigerian economy. Through its mandate, the NBS develops standard statistical methodologies, collects and analyses data, and disseminates statistical information that serves as a cornerstone for economic planning and evaluation.
GDP rebasing involves updating the base year used to calculate constant price estimates to reflect the changes in the economy over time. It replaces an outdated base year with a more recent one, ensuring that the prices of goods and services used in calculations are aligned with current market realities. This process is essential because economies are dynamic, experiencing growth, recession, structural changes, and shifts in consumption patterns. New products emerge, industries expand or shrink, and technological advancements reshape how goods and services are produced and consumed.
The 2008 System of National Accounts (SNA) recommends rebasing national accounts every five years to maintain relevance and accuracy. Rebasing is conducted at the most detailed level to enhance the quality of constant price estimates, ensuring a precise reflection of economic activities. For Nigeria, the choice of 2019 as the new base year aligns with these principles, as it represents a period of relative economic stability, free from the distortions caused by the global pandemic and other recent economic disruptions.
The process of GDP rebasing in Nigeria is grounded in internationally recognized manuals and classifications, including the 2008 System of National Accounts, the International Standard for Industrial Classification of Economic Activities (ISIC) 4.0, and the Central Product Classification (CPC) 2.0. These frameworks ensure consistency and comparability with global practices, enabling Nigeria to align its economic statistics with international benchmarks.
Central to the rebasing effort is the compilation of a detailed Supply and Use Table (SUT), a comprehensive matrix that captures the intricate relationships between industries and products. For Nigeria, the SUT includes 46 industries and 217 products, providing a granular view of the economy. This meticulous approach ensures that the rebased GDP reflects the true size and structure of the Nigerian economy.
The success of the rebasing exercise hinges on the quality and comprehensiveness of data. The NBS has drawn on a range of sources, including the Nigeria Living Standard Survey (NLSS), the National Business Sample Census, and the National Agriculture Sample Census. Special studies have been conducted to capture activities such as research and development, waste management, and trade and transport margins.
Collaboration with Ministries, Departments, and Agencies (MDAs) has further enriched the data collection process. Key contributors include the Federal Ministry of Communications and Digital Economy, the Central Bank of Nigeria, the National Pension Commission, and the Nigerian Midstream and Downstream Petroleum Regulatory Agency. These partnerships have facilitated the incorporation of emerging sectors such as digital economic activities, modular refineries, and the activities of pension fund administrators. Even informal and hidden economic activities have been brought into focus, ensuring a holistic representation of Nigeria’s economic landscape.
The 2024 GDP rebasing exercise marks significant improvements over previous efforts. New areas of the economy, such as quarrying, domestic households as employers, and activities of modular refineries, have been captured. Enhanced methodologies and broader data coverage have resulted in a more accurate and inclusive picture of Nigeria’s economic activities.
The implications of this exercise are profound. Rebasing can lead to changes in the size and structure of the economy, impacting key indicators such as the tax-to-GDP ratio, debt-to-GDP ratio, and per capita income. It provides policymakers with an updated and realistic view of the economy, enabling them to make evidence-based decisions. For investors, an accurate GDP measure enhances confidence, as it reflects the true potential and opportunities within the economy.
The NBS has demonstrated unwavering commitment to adhering to international standards throughout the rebasing process. By aligning with global best practices, Nigeria ensures that its economic statistics are credible and comparable on a global scale. This adherence not only enhances the reliability of the rebased GDP figures but also positions Nigeria as a key player in the global economic community.
The rebasing of GDP is a monumental task that requires the full commitment and cooperation of all stakeholders. From government agencies and private sector participants to international partners and the general public, every stakeholder has a role to play in ensuring the success of this critical exercise.
With the enormous work undertaken by the NBS and its collaborators, the results of the 2024 GDP rebasing are expected to provide the best estimate yet of the current size and structure of the Nigerian economy. As Nigeria continues to navigate its economic journey, this rebasing exercise serves as a vital tool for understanding the nation’s progress and potential, paving the way for sustainable development and prosperity.
GDP rebasing is a critical statistical exercise that updates the base year used for calculating a country’s economic activity to reflect current market realities. For Nigeria, this involves transitioning to 2019 as the new base year to account for significant changes in the economy, including shifts in consumption patterns, structural adjustments, and the introduction of new products and industries. Spearheaded by the National Bureau of Statistics (NBS), the rebasing process adheres to international standards, ensuring accurate and globally comparable results.
The NBS employs detailed frameworks, such as the Supply and Use Table (SUT), which encompasses 46 industries and 217 products, to provide granular insights into Nigeria’s economic structure. Data is sourced from national surveys, special studies, and collaborative efforts with key government agencies and institutions. This approach captures previously underrepresented areas like digital activities, modular refineries, and informal sectors. The exercise has significant implications for Nigeria’s economic indicators, including tax-to-GDP and debt-to-GDP ratios, per capita income, and the overall size and structure of the economy.
Key differences in the 2024 rebasing include enhanced data collection, a broader economic scope, and alignment with the 2008 System of National Accounts. These improvements ensure a more comprehensive and accurate representation of Nigeria’s dynamic and diverse economy, enabling better decisionmaking for policymakers, investors, and other stakeholders.
The rebasing of Nigeria’s GDP underscores the importance of keeping economic measurements aligned with current realities. It is more than a statistical adjustment; it is a critical foundation for informed policymaking, effective governance, and sustainable economic development. By capturing the breadth and depth of Nigeria’s economic activities, the 2024 rebasing exercise offers an invaluable tool for addressing the challenges and opportunities in Nigeria’s economy.
The National Bureau of Statistics has demonstrated a high level of commitment and professionalism in adhering to international standards and engaging stakeholders across various sectors. The results of this exercise are expected to reveal the true size and structure of Nigeria’s economy, offering a clearer picture of its strengths, vulnerabilities, and untapped potential. Ultimately, GDP rebasing is not just about numbers; it is about enabling Nigeria to take bold, data-driven steps towards economic growth and development. With this updated economic portrait, Nigeria is better equipped to navigate the complexities of the global economic landscape, attract investment, and chart a path toward a prosperous future.
* Abiona is an Abuja based consultant.
