The rebasing of Nigeria’s Gross Domestic Product, which is expected to increase the estimated size of the economy by around 40 per cent, is likely to be delayed until next year.
Reuters quoted the Director-General, National Bureau of Statistics, Dr. Yemi Kale, as saying on Monday that “it is unlikely that even the target of 2013 will be met. I underestimated how much work needs to be done, I think everyone understands that this is very, very crucial and has to be done properly.”
Several deadlines to implement the changes have been missed, with the latest being the fourth quarter of this year.
The country has not rebased her GDP since 1990. Most governments overhaul gross domestic product calculations about every five years to reflect changes in output and consumption, such as mobile phones and the Internet.
Some economists have warned that a sharp increase in the size of the economy would mean slower growth.
Kale, however, said, “You will expect that the bigger the economy, the slower the growth, but I don’t think it is as easy as that. Regardless of what our GDP is, we are still going to be small enough to produce even sharper growth rates.”
The Managing Director, Financial Derivatives Company Limited, Mr. Bismarck Rewane, had recently said the plan to rebase the GDP would result in an increase in the nominal GDP to an estimate of $400bn.
According to him, the maximum deficit for 2013 would have been N1.3tn but the rebasing will allow for a deficit of N900bn or 1.5 per cent.
Rewane said although with rebasing, Nigeria would still be able to meet the convergence criteria for the Economic Community for West African States, the level of inequality in the economy was magnified, shifting in status from a low-income to a middle-income economy.
The plan, according to him, will cut off a country’s access to foreign aids and support, adding that Ghana, after rebasing, was re-classified from low-income to middle-income status.
The recalculation will enable Nigeria to join the ranks of middle-income countries and put it much closer in size to South Africa, the continent’s most developed economy.
Analysts have said that Nigeria may likely overtake South Africa to seize the top spot, with a growth rate of over six per cent a year, compared with three per cent for South Africa.
The rebasing, which will likely boost the economy of Nigeria from roughly $250bn to around $350bn, will bring it very close to South Africa’s $385bn.