Nigeria: A Larger, More Diversified Economy To Continue Robust Growth
Nigeria recently announced the results of a recalculation of its GDP measure.
- Nigeria is now the biggest economy in Africa and was the 24th biggest in the world in 2013, according BMI estimates. In 2013, GDP was USD500bn, compared to the old data's measure of USD266bn (an 89% increase).
- Nigeria's economy has not abruptly surged in size. What has changed is the method by which the authorities count and present economic data. This method incorporates informal and newly-formed industries that were not previously included in the national accounts. In other words, in practical terms not much has changed on the ground; the data now simply reflects the on-the-ground situation more accurately.
- The new data represents the evolution of Nigeria's economy over the last 20 years, with secondary and tertiary industries now contributing more than half of total output.
- The agriculture and oil sectors have seen their shares of GDP decline significantly. The agriculture sector is not only smaller relative to GDP than previously thought, but is also growing more slowly, suggesting that agricultural reforms have not been as successful as many assumed.
- Despite being measured from a much higher base, we believe that the economy as whole will continue to expand by around 7.0% per year over the next few years thanks to the decrease in the contribution of the sluggish oil sector, and the increase in the weighting of more dynamic and faster-growing industries such as manufacturing and services.
Full analysis of Nigeria's economy, and indeed other Sub-Saharan African economies, is available to subscribers at Business Monitor Online.