It is amazing what great transformation a little recalibration – beg your pardon, rebasing – has wrought on the profile of the Nigerian economy.
For two full decades, we tormented ourselves with guilt that the economy was underperforming, what with a GDP that stood at a piddling $283 billion. Following the re-basing, we now know that the GDP actually stands at a roaring $510 billion, pushing South Africa to a distant second in Africa in that department and sending powerful warning signals to the world that the Nigerian juggernaut has finally arrived.
Our consuming desire, which seemed more an exorbitant declaration intent than a remote possibility, was to enter the ranks of the world’s largest economies, the so-called G20, by the year 2020. Every indication now is that Nigeria will hit that milestone several years ahead of projection. Our planners will now have to rebase Vision 20/20:20 itself.
Several decades ago, the per capita GDP was a paltry $1,500, which placed Nigeria in the same unproductive bracket as India and Ghana. As if that was not bad enough, some misguided Nigerians developed the pernicious habit of holding up the economies of those two countries as models of growth and stability.
Now we know that Nigeria’s per capital GDP stands at $2,989, places it well outside their league. The acronym BRIC once designated the rising global economic bloc comprising Brazil, Russia, India and China. Then, it was enlarged to BRICS, to accommodate South Africa and, it would now seem in retrospect, to spite Nigeria.
With the galloping profile of Nigeria’s economy as revealed by the recent rebasing, global leaders of economic thought are set to drop South Africa from that league and replace it with Nigeria, which they consider more worthy of the distinction. With that change, and in the interest of euphony, I gather from the best authorities that the league will henceforth be known as BRINC.
Good riddance, then, to South Africa, the upstart that was always thumbing its ungrateful post-apartheid nose at the Big Benefactor up North. Living well, it has been said, is the best revenge. So out with BRICS, and in with BRINC.
For decades, the conventional wisdom was that the manufacturing sector in Nigeria was in great distress if not positively doomed, and that some industries were relocating to Ghana where the business climate was allegedly more friendly. Everyone blamed the epileptic power supply for the poor state of manufacturing
The rebasing shows indeed that manufacturing has suffered a decline, but not to the extent of validating the conventional wisdom that the power supply, especially electricity, is a cardinal factor in the calculus of economic growth and development. .
In the United States where power supply is guaranteed round the clock except in the face of the direst disasters, Wall Street erupts in champagne-drenched celebration and the stock market index rises sharply if the economy manages to record a 2 percent growth.
But in Nigeria where power is severely rationed if and when it is available, the economy has been growing at a pace more than three time faster than that of the United States. And whereas manufacturing is in precipitous decline in the United States, in Nigeria it has taken only a 50 percent tumble.
Meanwhile, following the rebasing, it has come to light not merely that the economy has all the while been growing at a dizzying, superheated 7 percent a year.
It follows, then, that the importance of electricity has been vastly exaggerated.The question must now be asked: Who needs a steady power supply when the economy is growing at such a furious gallop?
Conventional wisdom has also been upended in many other areas of the economy, following the rebasing. The rate of employment used to be considered an indication of the health of the economy. Employment increased as the economy grew, they said. But the Nigerian example shows conclusively that jobless rate can actually increase sharply or stay stagnant even as economy expands.
So, why make a fetish of job creation? Why take up all that trouble and expend so much imagination cooking numbers reflecting progress in job creation when the economy is doing just fine without it? Why the national lament that more than half a million persons subjected themselves to accidental death crippling exertions to fill 4,000 advertised positions – why bemoan this when the economy is growing at such a breath-taking pace?
Again, they used to claim that you cannot build a strong economy without a good road network and sound transportation system. But our rebased economy has just debunked that claim by building the world’s 26th largest economy without freight trains and without anything that can be called water transportation, propelled only by express passenger trains that take a whole day to travel the roughly 240km from Lagos to Ilorin?
Who really needs all that infrastructure? Certainly not the economy.
Consider yet another factor that economists are always trumpeting as indispensable to growth and development: stability. As far as I know, nobody has ever accused Nigeria of pursuing, much less attaining, stability. Everywhere you turn – in the neighbourhoods, on the highways, in the professions, in the universities, in the policy establishments, in the motor parks, in police stations and army barracks and even in the precincts of the Presidential Villa, instability reigns.
To cite practical examples from the policy establishment: One day they are banning rice imports to conserve foreign exchange and encourage local industry. The next day, they undo the ban, saying that only big-time smugglers are profiting from it.
Again, one day they ban wheat imports and declare that cassava bread will replace wheat bread as the favourite item on the nation’s breakfast table; the next day, they launch a national wheat-production programme.
But the really exciting thing is that, far from acting as a brake on economic growth, instability has actually been a spur.
There is no other way to explain the robust expansion the rebased economy has witnessed in two decades of acute instability. It will come as no surprises if it turned out on further rebasing that the North-east and the Plateau-Bauchi axis constitute the fastest-growing and most productive regions in Nigeria.
In light of these profound insights that rebasing the economy has yielded and many others that I cannot do justice to in this piece, economists will have to rework – beg your pardon one more time — rebase, recalibrate, readjust or re-whatever their old theories and revise the standard texts.
From Himself the Igodomigodo
“My Own Big Brother,
“I called your line yesterday to show my cornucopious appreciation to you for your munificent words and the very nice things you said of me in your hebdomadal pantagruelian and yet dialectical didactic (pardon my alliteration) column (“To Patrick Obahagbon, from a kindred soul,” April 7, 2014).
“The panegyrics coming from a literary avatar and a sui generis lollapalloza that I have admired his inimitable, intrepid and polyvalent style for a period of aeon was an anodyne for me.
“I thank you for everything and may your utilitarian pen never suffer any hiatus or atrophy.
“Thanks my Senior Brother. I will keep in touch.”
Say it for the Hon Patrick Obahiagbon. He never disappoints.
