Nigeria became the biggest African economy in 2014 (surpassing South Africa) by rebasing GDP, going from $270 billion to $510 billion. It is currently the 25th largest economy in the world. The rebasing involved a change in the base year from 1990 to 2010, now following System of National Accounts (SNA) 2008, the use of industrial classification International Standard Industrial Classification Rev. 4 (from Rev 3.1). It involved a level shift in GDP of 59.5% in 2010 (89.2% in 2013). The rebasing itself provides insights into what data tell us about patterns of structural change. The greatest increase in level of value addition as part of the rebasing was in information and communication, trade, manufacturing, and real estate. Thus there is evidence of (faster) structural change than was reported under the old GDP series, as there is a strong increase in share of services sector, and a strong decline in share of agriculture and also industry.
Figure 1. Rebasing Nigerian GDP and sectoral shares in GDP (old and new data) (NBS data)
Notably, the manufacturing share in GDP was higher and manufacturing growth was stronger than previously expected (according to the National Bureau of Statistics this was 1.9% in 2010 under the old series, but it was 6.6% in 2010 under the new series). This reflects the inclusion of better and more survey data (e.g. expanded business registers) and a reclassification between sectors (e.g. firms processing farm produce from ‘agriculture’ to ‘manufacturing’). The Supply and Use Table for Nigeria has not yet been published (although below we use a version from the Eora database). The Nigerian manufacturing report of 2012 provides insights into how the rebasing exercise completely changes our view of the manufacturing sector. Prior to the rebasing, the manufacturing sector was in decline; after the rebasing it appears to be much bigger and growing (Figures 2 and 3). Of course, it should be borne in mind that the share of manufacturing in GDP is still low.
A closer look at international data sources that describe Nigeria’s value added data suggest it is also important to triangulate amongst different sources. For example, some data sources splice rebased data to old series, making it difficult to interpret the data; see how the data for manufacturing in Nigeria jump in 2010 in figure 4 (this is the result of using the rebased data from 2010, and the old data until then). It is also instructive to read the ‘Comment’ piece by the University of Groningen on Nigeria rebasing.
Figure 2. The share of the manufacturing sector in GDP declined from 1980s to 2010 (old series) (manufacturing report, NBS)
Figure 3. Increasing share of manufacturing in recent years (new GDP series) (manufacturing report, NBS)
Figure 4. The share of the manufacturing sector in GDP (WDI data)
