The statistician general of Nigeria, Yemi Kale, claims the Nigeria GDP in 2013 rose from 42.4 trillion naire to 80.4 trillion naire ($510 billion), which is approximately an 89% increase. A lot of economists believe the first number may have been fiddled, but that the 2nd number is correct.
Implications of this mean that Nigeria has climbed to the highest sub-saharan economy, moving past South Africa who had approximately $350 million GDP in 2013. Nigerian statisticians improved their gathering and calculations of GDP. For example, the old GDP in Nigeria was solely based on output. Now, this country has added in spending and income as well, increase the GDP exponentially.
This number may seem misleading, to show as if the economy grew, when in reality, they just added in other components that GDP contains. The economy probably didn't grow too much, but due to the extreme adjustment of GDP, it looks as if it had.
Nigeria also increased their sample size of firms from 85,000 to approximately 850,000, including a lot of small firms. The numbers actually show that Nigeria's economy has grown manufacturing from less than 2% to 7% of GDP. Film-making never showed up as a category of Nigeria's GDP, but it is now at 1.4%.
Although this GDP seems impressive, Nigerians aren't richer than they were before at all. The majority of the 170 million residents in the country survive on less than $1.25 a day. Most of Nigeria is just an oil enclave, being 14% of GDP. However, the service industry is booming.
http://www.economist.com/news/finance-and-economics/21600734-revised-figures-show-nigeria-africas-largest-economy-step-change
Its very interesting how an adjustment to the calculation of GDP can manipulate economic growth on paper. The Nigerians are basically trying to make their economy look stronger when in fact it really isn't. Many people know that they intentionally did the Nigerians intentionally did this, and that their data doesn't accurately reflect the state of their economy. I'm not quite sure what the Nigerians are trying to accomplish here.
ReplyDeleteThere is a possibility that the Nigerians are attempting to attract businesses. By presenting their economy to be better than it is, some businesses may think their economy is more stable than it actually is. If this is so, there is a possibility that businesses will be attracted to this increase in GDP per capita of Nigeria.
ReplyDeleteTo increase the investment and get confidence from abroad, every country can adjust the GDP. In fact china also abjust some eonomic indicators. the author says that the majority of the 170 million residents in the country survive on less than $1.25 a day. That is understandable, because the birth rate of Nigeria is high and Nigeria relys on the oil,meaning the wealthy cannot be divided to all of people.
ReplyDeleteNigeria is an economy to be taken seriously and with the inclusion of small businesses and now updating the base year for its GDP, there are now more accurate numbers to base its growth on. However, it is still interesting to note, the majority of its 170m-plus people live on less than $1.25 a day
ReplyDelete