In the coming weeks, the National Bureau of Statistics (NBS) is expected to release Nigeria’s rebased Gross Domestic Product (GDP) figures marking the first major update of the country’s economic data in over a decade. This is a significant development. GDP rebasing is more than a statistical adjustment; it’s a vital tool that updates how we measure the economy based on current realities how Nigerians earn, spend, and produce in today’s economy.
Given the transformations in Nigeria’s economic landscape, the rebasing is likely to show a considerably larger economy. Activities that were previously underreported or excluded such as mobile payments via OPay and PalmPay, Netflix subscriptions, on-demand food delivery through Jumia or Glovo, the short-let real estate boom in urban centres, digital gigs by skit makers and influencers, and the sprawling informal markets will now be accounted for.
As was the case in 2014, when Nigeria last rebased its GDP and leapfrogged South Africa to become the continent’s largest economy, the upcoming update could result in impressive headline figures. But such figures, while statistically valid and internationally recognized, must be viewed with informed caution.
A Clearer Economic Picture
The benefits of GDP rebasing are well-established. It gives a more accurate snapshot of economic activity, helping policymakers, investors, and researchers make better decisions. It also brings Nigeria in line with international statistical standards, improving the country’s credibility with institutions such as the IMF, World Bank, and global credit rating agencies.
A larger GDP can attract more investment, particularly in sectors like consumer goods, fintech, agriculture, and digital services. It allows state governments to benchmark and plan more effectively and may improve Nigeria’s debt-to-GDP ratio, an important metric for investors and creditors.
The Caveats: Revenue Gaps, Debt Illusions, and Development Lags
However, the rebasing also presents serious challenges that should not be glossed over. One such issue is the revenue-to-GDP ratio, which, even before rebasing, lingers below 10%, one of the lowest globally. A larger GDP without a corresponding increase in government revenue will only make this ratio look worse, highlighting Nigeria’s chronic under-collection of taxes.
Encouragingly, ongoing tax reforms by the federal government could help close this gap. Informal traders in places like Alaba Market or building material sellers in Suleja, long outside the tax net, may soon fall under structured taxation. By broadening the tax base, improving compliance, and leveraging digital tools such as e-filing and cashless monitoring, the reforms aim to align public revenue with the true size and complexity of the Nigerian economy.
Another challenge is the illusion of fiscal space. A lower debt-to-GDP ratio post-rebasing might suggest more room to borrow. Yet, over 60% of Nigeria’s current revenue already goes toward debt servicing. A higher GDP figure does not change this fundamental reality.
Moreover, key development indicators—such as public spending on health, education, and social welfare are often measured as a share of GDP. If actual spending doesn’t rise in tandem with the rebased GDP, those ratios could shrink. For citizens relying on under-resourced clinics in Kogi or schools in Bauchi, a bigger economy won’t mean much if service delivery remains poor.
Bridging the Perception Gap
Perhaps the most sensitive challenge is managing public expectations. People will hear that the economy has grown, but their daily lives may not reflect that change. Joblessness, high inflation, and poor infrastructure may persist. For a young graduate still job-hunting or a food vendor watching prices soar, the question remains: What does a bigger GDP mean for me?
The answer is complex and macroeconomic in nature, but it must be communicated clearly. Thought leaders, policymakers, and the media must explain both the benefits and limitations of GDP rebasing. It’s not a political victory, nor a cure-all—it’s a diagnostic tool.
A Call for Real Progress
For a government elected on the promise of reform-led growth, a rebased GDP should be a call to action, not complacency. It highlights economic opportunities but also exposes structural weaknesses. The real test is whether this clearer picture leads to clearer progress.
The rebasing must not be politicized or misrepresented. It should be viewed as a necessary step in modernizing economic management. But the true measure of success lies beyond the numbers.
In the end, what matters is not how large the economy appears on paper, but whether it delivers jobs, affordable food, quality education, reliable healthcare, and a better standard of living for Nigerians.
GDP rebasing can sharpen our understanding—but it’s up to Nigeria’s leaders and institutions to ensure that it also sharpens our future.
