After ten years of continuous decline in the size of the Nigerian economy which contracted from $540 billion in 2015 to $188 billion by early 2025, the government, probably motivated by the need to keep up appearances urged the National Bureau of Statistics (NBS) to rebase the country’s Gross Domestic Product (GDP) for reasons that where more politically motivated than the need to update the country’s data for economic planning.
Before the recently carried out rebasing exercise, the country’s GDP was last rebased in 2013, when Nigeria’s GDP was estimated to be around $259 billion. However, after the rebasing exercise, the GDP was revised upwards to $510 billion, representing a 76% increase. This significant leap was due to the recognition of new sectors and industries such as the Internet and Communication Technology (ICT), Pensions, and entertainment industries, which had grown significantly since the previous base year of 1990.
So in early 2025, the government commissioned the NBS to rebase the GDP of the country in the hope that a similar result to what was obtained during the last rebasing exercise would be achieved. The outcome of the rebasing exercise resulted in the country’s Gross Domestic Product being rebased from N287.5 trillion ($188 billion) to a staggering N372.8 trillion ($243.7 billion). This represented a remarkable 38% increase from prior estimates, incorporating previously excluded sectors like e-commerce, mining, and informal economic activities while updating the base year from 2010 to 2019.
Yet for all the fanfare surrounding these impressive figures, one stubborn fact remained unchanged: Nigeria continues to hold its position as Africa’s fourth-largest economy, trailing behind South Africa ($373 billion), Egypt ($347.6 billion), and Algeria ($266.8 billion). This outcome reveals a fundamental truth about statistical exercises versus economic reality. Numbers on paper don’t automatically translate to improved continental standing. It also reveals that, rather than playing the numbers game, the Nigerian government needs to put in a lot more effort to grow its economy if the country is to return to its once enviable position of being Africa’s biggest economy.
To understand the concept of GDP rebasing better, it is a standard statistical practice where countries update their economic calculations to reflect current economic structures and include previously unmeasured activities. Nigeria’s exercise was long overdue, having used 2010 as its base year for over a decade during which the economy had undergone significant structural changes.
The rebasing captured numerous economic activities that had emerged or expanded since 2010, including the booming fintech sector, expanded telecommunications, and a more comprehensive accounting of informal economic activities that form the backbone of Nigeria’s economy. The inclusion of these sectors provided a more accurate picture of the country’s true economic output.
However, rebasing is fundamentally a retrospective exercise. It doesn’t create new wealth or productivity; it simply provides a clearer lens through which to view existing economic activity. This explains why Nigeria’s continental ranking remained static despite the substantial upward revision in GDP figures.
Nigeria’s unchanged position reflects the broader dynamics of African economies and the challenges of currency fluctuations in nominal GDP comparisons. South Africa maintains its lead as Africa’s largest economy, benefiting from a more diversified industrial base, stronger institutions, and currency stability that supports its nominal GDP figures when converted to US dollars.
Egypt holds the second position, leveraging its strategic location, tourism sector, and significant investments in infrastructure projects. Algeria rounds out the top three, buoyed by its substantial oil and gas revenues, though like Nigeria, it faces challenges from commodity price volatility.
What’s particularly telling is that Nigeria’s rebasing exercise, despite adding almost $60 billion to its GDP calculation, wasn’t sufficient to bridge the gap with its continental peers. This suggests that the other major African economies have also been growing and expanding to maintain their relative positions, while the Nigerian economy has been shrinking even though the rebasing exercise captured more of its economic activity in official statistics.
Nigeria’s experience highlights several important economic realities. First, it underscores the importance of regular statistical updates to maintain accurate economic portraits. The country’s economy had evolved significantly since 2010, and the rebasing exercise provided crucial insights into these changes.
Second, it demonstrates that statistical exercises, while important for planning and analysis, don’t automatically translate to competitive advantages. Nigeria’s economy may be 38% larger than previously thought, but this doesn’t immediately resolve the structural challenges that limit its growth trajectory relative to continental peers.
The rebasing also reveals the substantial informal economy that characterizes much of Nigeria’s economic activity. By capturing more of these informal sectors, the exercise provided valuable insights into the true scope of economic activity, which is essential for policy-making and development planning.
Finally, the rebasing exercise revealed the failure of the government to effectively manage the economy since 2015, when the decline began, and has been allowed to linger for ten successive years. Before 2015, Nigeria had always ranked amongst the fastest-growing economies in Africa since the return to democracy in 1999 and was projected to become one of the top ten economies in the world by 2030. Sadly, this projection has now become a mirage.
The rebasing exercise, while not changing Nigeria’s continental ranking, provides a more solid foundation for economic planning and policy-making. It offers a clearer picture of sector contributions to the economy and identifies areas of strength that can be further developed.
Nigeria’s GDP rebasing story serves as a reminder that economic development is about more than statistical accounting. While the exercise successfully captured the true scope of Nigeria’s economic activity and provided valuable insights for policymakers, it couldn’t overcome the fundamental economic dynamics that determine continental rankings.
The unchanged fourth position doesn’t diminish the value of the rebasing exercise but rather emphasizes that sustainable economic advancement requires structural improvements, productivity gains, and institutional development rather than statistical revisions. For Nigeria to climb the continental rankings, it will need to address the underlying factors that constrain growth and competitiveness. These are challenges that no amount of statistical rebasing or propaganda can resolve.
The exercise does, however, provide a more accurate baseline from which to measure future progress and a clearer understanding of where the economy stands today. In that sense, while Nigeria’s position may be unchanged, its path forward is now illuminated by better data and a more comprehensive understanding of its economic landscape.
Oshobi, a development economist, management consultant, and author, writes from Lagos, Nigeria.