- Title: NIGERIA: Nigeria surpasses South Africa as continent's biggest economy
- Date: 7th April 2014
- Summary: ABUJA, NIGERIA (APRIL 7, 2014) (REUTERS) VARIOUS OF NEWSPAPERS ON DISPLAY/NEWSPAPER HEADLINE READING: NIGERIA NOW AFRICA'S BIGGEST ECONOMY
- Embargoed: 22nd April 2014 13:00
- Keywords:
- Location: Nigeria
- Country: Nigeria
- Topics: General,Economy
- Reuters ID: LVA5E7TJ6G735QJZ1AVA8M2845PR
- Story Text: Nigeria has overtaken South Africa as Africa's largest economy after a rebasing calculation almost doubled its gross domestic product to more than 500 billion US dollars (301 billion pounds), data from the statistics office showed on Sunday (April 6).
GDP for 2013 in Africa's top oil producer was 80.22 trillion naira, or 509.9 billion US dollars, the Nigeria Bureau of Statistics said, up from the 42.3 trillion estimated before the rebasing.
The new figure shrank Nigeria's debt-to-GDP ratio to 11 percent for 2013, against 19 percent in 2012.
Most governments overhaul GDP calculations every few years to reflect changes in output, but Nigeria had not done so since 1990, so sectors such as e-commerce, mobile phones and its prolific "Nollywood" film industry now worth 1.4 percent of GDP, had to be factored in to give a better picture.
Growing attention from foreign investors was forcing Nigeria to more accurately calculate its statistics, including GDP.
"Without good data it's very difficult for policy makers to assess what development challenges need to be tackled. When the data is not adequate, the policy maker is left to operate in the dark and or simply to do guess work and I think when you see the results you would see we have been doing reasonably good guess work but we can do better than that and we don't want to risk solving the wrong problems because we don't have adequate information or statistics or solving problems in the wrong way that's why this rebasing is so important," said finance minister Ngozi Okonjo-Iweala.
Nigeria, Africa's most populous country with 170 million people, has been growing as an investment destination owing to the size of its consumer market and growing capital markets.
The jump in the official GDP figure ranks Nigeria as 26th biggest economy in the world, up from 33rd before the rebasing.
Though GDP per capita rose to 2,688 US dollars last year from an estimated 1,437 US dollars in 2012, poverty and inequality widened.
According to a recent World Bank poverty survey, 60 percent of Nigeria's 170 million people live under a dollar day, and many in the capital Abuja say the new data does not reflect ordinary Nigerians.
"It doesn't affect the common masses on the streets, it only affects the top shots, the ministers and the governors and the others it doesn't affect us because for one we don't have jobs; where are the jobs? Where is the economy growing from? Is it the oil and some other things? In fact I don't have anything to say for this government," said one Abuja resident, Alex Oheme.
"We are seeing it on paper, actually until it finally translates into a common man like me you know until I see people getting employed and food getting cheap and fuel going down and everything that concerns the common man, it's just paper sake and just promoting the country's image out there," said another Abuja resident, Abdulhamid Salau Nigeria's annual GDP growth for 2013 is expected to come in at 7.41 percent after the rebasing, compared with about 6.5 percent in 2012.
Yemi Kale, chief executive officer, National Bureau of Statistics said there is a need to work hard on infrastructure, governance, corruption and building a social safety net.
"We have a huge gap between what is available; 80 trillion and I can bet you less than half of that is actually being utilised. Let's utilise it fully then when we get to the peak we now start asking ourselves, what's left and it's based on what's left, it's based on what you feel is left that will determine what you need, and how you need to go. So I don't want to discuss whether it's double digits, we can grow at a 100 percent, if the growth is not deployed properly, we stay exactly the same way we are as far as social indicators are concerned," he said.
The statistics chief added that the base year would now be recalibrated every five years, in line with global norms.
Despite its roaring growth of recent years and now a bigger GDP, Nigeria still trails South Africa in basic infrastructure; power and roads, necessary to lift its people out of poverty.
Its mobile telephone network is one of the least reliable in Africa, internet quality is poor, roads are potholed and its ports and airports clogged by bad infrastructure and obstructive officials. The power grid provides barely four hours a day.
President Goodluck Jonathan's suspension in February of respected central bank chief Lamido Sanusi after Sanusi had questioned massive oil revenue leakages at the state oil firm reinforced Nigeria's reputation as a byword for corruption. - Copyright Holder: REUTERS
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