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Saturday, April 12, 2014

MINTs, PINEs, and NIGERIA'S NEWLY REBASE GDP NUMBERS





Last Sunday the 7th of March 2014, Nigeria announced it newly re-base GDP figure last revised in 1990. This year January Jim O'Neil, a British economist and former employee of the investment Bank Goldman Sachs came out with the new acronym of MINT (Mexico, Indonesia, Nigeria, and Turkey) more than a decade after he coined the popular acronym BRIC (Brazil, Russia, India, and China). Very recently come PINE (Philippines, Indonesia, Nigeria and Ethiopia) another acronym that added Philippines and Ethiopia as possible important players in the global economy or the region of the world they are located. Now that Nigerian economy is the biggest in Africa and 26th in the world, the important of Nigeria inside MINT and similar groups will increase. Nigeria's journey to the present has been thorny full of up and down and some time threats of breaking up into pieces. Some time during the tenure of President Obasanjo an American forecast saw Nigeria breaking up in 2015, other different forecasts saw Nigeria entering the league of 20 biggest economies in the world, 3rd most populous country in the world, etc. MINT and PINE acronyms are among the positive predictions on Nigeria that see it as playing a positive role in the global economy.


     The last re-basing of Nigeria's GDP have shown the world the potentiality of the Nigeria economy different from the picture the outside world has been relaying on in the past that show Nigeria as a slow growing economy and extremely comatose. Though, the re basing has changed nothing on the ground, neither the poverty level nor the absence of electric power has improved. But, the fact that it has provided a new reality, a new way of looking at things, from the point of both the authority and the business world, is a welcome development. Nigerians will now be sure that their governments have not been doing enough to improve their lot, looking at the size of the GDP and the enormous potentiality on the ground. Already a trend has become clear that shows consistent government in ability to direct the economy in the right direction. The main question to ask is what next after the re-basing? Should Nigerians go to sleep knowing that their nation is now the biggest economy on the continent? The answer is absolute no, if anything this newly release GDP figure is a call to duty for the authorities to rise up to the expectation and do the needful to take the country to where it truly belong. Instead of talking and making noise about our potentials which has been the norm since after Independence we should pay more emphasis to seeing that we realized those God given potentials. 

   With a big population such as ours Nigeria should have utilized the opportunity to modernize its retail sector, instead; just like with most other sectors of the economy the retail sector has been the way it was in the last 30 years with little changes. Government should have encouraged the rapid modernization of the sector embark on by some few foreign retailers as well as pockets of our local retailers. Just last three weeks, the ancient city of Kano witnessed the opening of its first modern retail market when Ado Bayero Mall was opened to the public with retailers such as South Africa Shoprite among it first tenants, with others such as  Massmart (a subsidiary of Walmart) joining them in the next few weeks. With population of over 10 million people, Kano and Lagos are the places to be for any retailer who wants to get across to the Nigeria's growing population of the middle class. When you compare Nigeria with some members of these groupings (MINT, PINE, even D8) you will find out that Nigeria has a lot of ground to cover. Take for example Mexico, it is already a manufacturing hub that exports automobiles, electronics, etc., to countries such as United States; Turkey Exports the same category of things to the European Union, the same thing cannot be said of Nigeria. Even Indonesia cannot be compared to Nigeria in term of manufacturing, they are ahead of us in this area. In fact for some years, made in Indonesia products have been all over Nigerian market. 



         Already an argument has been growing in the country on the newly released GDP figure with many Nigerians questioning the accuracy of the figure given as our new GDP number, as well as our position of being the biggest economy on the continent ahead of South Africa. On my part, i am not in any way doubting the figure, the fact that IMF and World Bank are involved in the re-basing program gives it some authenticity. But, the reality of our poverty is also real, world Bank has just released it study on global poverty where Nigeria is ranked third. This did not in any way contradicted the earlier released GDP figure, just like it is in the case of China and India. China is the 2nd largest economy in the world ahead of Japan, Germany, France and UK; but, at the same time it is grouped alongside Nigeria and India among the countries with largest concentration of poor in the world. Just as i read one Nigerian government official disputing the world Bank study, arguing that Nigeria is not as poor as the World Bank put it. I don't think this highly place government official is going around the country, it is most likely that he lives most of his live in Abuja luxury where life is like in other big world cities. He has forgotten that here in Kano city people spend a week without seeing electric light; Nigerians in rural areas have adjusted to the live of penury and hardship, and have lost any hope that government will remember them one day. Therefore, for those disputing the World Bank study that ranked Nigeria number three should please have a rethink and travel to their villages back home so as to share time with their people and feel how it is like to live their.

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