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Nigeria statistics chief has almost figured out the economy

A woman and two children stand along the Jos-Maiduguri road in the city of Maiduguri, northeastern Nigeria, May 19, 2013. Nigeria has more than 160 million people, 200 languages, 36 states and 774 local government areas.


Officials who spent their days under a mango tree falsifying forms. Villagers who were reachable only by canoe or whose first inclination was to attack the census takers. Such suspicion of government that businesses refused to provide data. More than 200 languages, 160 million people, 36 states and 774 local government areas.

These were among the challenges that greeted Yemi Kale when he was appointed Nigeria's statistician-general two years ago – and some of the reasons why his quest to provide more accurate gross domestic product figures for Africa's second-largest economy are taking so long.

The National Bureau of Statistics has been working since early 2012 to gather enough data to re-base Nigeria's GDP, which is at present measured against output and consumption patterns from 1990, when booming sectors such as mobile telecommunications and the "Nollywood" film industry did not exist. Most developed countries change their calculations every five years.

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Analysts expect that Nigeria's economy, which the NBS put at $258-billion (U.S.) in 2012, will see a significant upward revision after re-basing, as happened in Ghana in 2010, when GDP grew by 60 per cent following a similar exercise. Renaissance Capital said in a report this month it expected a 40-per-cent increase Nigeria's economy, which would measure it at $361-billion, using current figures, close to that of South Africa's, which is estimated at $385-billion.

With growth of 6.6 per cent, more than double that of South Africa, Nigeria could soon have the bragging rights as Africa's biggest economy.

"I am not allowed to be a betting man," Mr. Kale said, "but my gut feel says there will be a sizable increase in our GDP. I think it is understated."

Nigeria's re-basing exercise was originally supposed to be completed last year but the finish date has repeatedly been postponed. Mr. Kale admits he underestimated the size of the task. His staff are still collecting information on nine areas of the economy, including the prolific Nollywood industry, mining, hotel and restaurants, non-governmental organizations, and the huge informal sector, which is only partially accounted for under current measurements.

Censuses of the agricultural and business sectors, which were last surveyed in the mid-1990s, also need to be done. The World Bank, International Monetary Fund and African Development Bank are providing technical assistance.

"I can guarantee that it [the re-basing] will be done in 2014, hopefully in the first half of the year," Mr. Kale said. "But it depends how fast we can get moving with these surveys. We have to make sure we get it right."

The NBS is still deciding on whether to make 2010 or 2012 the new base year for the GDP calculation.

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A larger economy will increase per-capita GDP, now at about $1,650, and make the budget deficit and debt-to-GDP ratios smaller. But it will also highlight the low tax revenues and lack of savings from oil revenues, with just $6-billion in the Excess Crude Account, down from $9-billion in January.

The re-basing will offer a different and more representative picture of the economy. Agriculture, which last year made up 40 per cent of GDP, is likely to decrease in influence, with telecoms and entertainment sectors given larger weightings.

Credible data on Nigeria are in high demand, particularly from foreign investors who view it as an increasingly attractive frontier market, Mr. Kale said. Nigerian governments have not always seen it that way. The NBS "was a place you were sent if you offended your boss" and had an annual budget of just $1-million for data collection in 2011. The response rate for most surveys was just 50 to 60 per cent. For business questionnaires it dipped to 20 per cent, leading Mr. Kale to question whether the official economic statistics were accurate.

"We had good household data, not so much for GDP. But I don't think the numbers were so bad that they misguided public policy," he said.

With his budget having risen sixfold, data collection and quality has improved, Mr. Kale says, and he is "100-per-cent comfortable" with the growth rates reported since his appointment. Even so, the NBS's growth and poverty statistics have come under the spotlight recently, with the World Bank pointing out the "puzzling contrast" between the numbers. GDP has increased by an average of 7 per cent for the past decade but poverty rates only declined slightly from 64.2 per cent to 62.6 per cent. Unemployment has risen to 23.9 per cent.

Mr. Kale said: "The average man on the street may doubt the GDP figures, saying he is not feeling the growth. But we also have the richest man in Africa [Aliko Dangote]. So the economy is growing but the data shows we need to address inequality."

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