Nigeria's Economy

by Developed Africa 14. April 2014 09:00

Nigeria has now surpassed South Africa as Africa’s largest economy, but you might be wondering how it happened so quickly?

By “rebasing” their economy, Nigeria could factor in a number of sectors which its GDP had never reflected or recognised.

In computing its GDP all these years, Nigeria, incredibly, wasn't factoring in booming sectors like film and telecommunications."

So by changing what making sure these sectors are recognised in the calculations, Nigeria’s GDP jumped 89% to $510bn.

But as the article from the Atlantic points out, what does this say about the way we measure prosperity? And are we laying too much faith in the measure of GDP to indicate economic strength?

As Coyle wrote on Monday, this week's GDP overhaul will likely make investors and entrepreneurs more confident in Nigeria. And yet, "Nothing real has changed, the economic problems like poverty and inequality and a poorly-functioning state remain."

What would be intriguing is to see what would happen to other African nations if they took on a rebasing of their economy. Whilst Coyle states that:

Africa as a whole probably is not as poor as we've long though"

this rebasing should take nothing away from the urgency with which African nations need to address their economic problems.

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